Apollo AR-09-10 · Apollo Hospitals (UK) Ltd. Apollo Munich Health Insurance Company Ltd Indian Hospitals Corporation Ltd. Imperial Cancer Hospital & Research Centre Ltd

22nd

1

Board of Directors

Chairman : Mr. Rakesh Mehta

Vice Chairman : Dr. Prathap C. Reddy

Managing Director : Mr. Jaideep Gupta

Directors : Mr. Anil Kamineni

Dr. B. Venkataraman

Mr. J. P. Singh

Mr. Rajendra Kumar

Prof. Ranjit Roy Chaudhury

Ms. Renu S. Karnad

Mr. Satnam Arora

Mr. S. Regunathan

Ms. Suneeta Reddy

Lt Gen. (R) Vijay Lall

Prof. V. N. Rajasekharan Pillai

Mr. V. R. ReddyVice PresidentCum Company Secretary : Mr. Ajay Kumar Singhal

Registered Office &Hospital Complex : Sarita Vihar,

Delhi - Mathura Road, New Delhi - 110 076

Hospital at Noida : Apollo Hospitals,E-2, Sector-26,Noida - 201 301

Auditors : M/s. S. C. Vasudeva & Co.Chartered Accountants,New Delhi

Bankers : Oriental Bank of Commerce,AXIS Bank Limited

1 Director Page.p65 8/5/2010, 12:54 PM1

2

Indraprastha Medical Corporation Limited

CONTENTS

Notice ...................................................................... 3

Directors' Report ..................................................... 8

Management Discussion and ................................. 16Analysis Report

Report on Corporate Governance .......................... 21

Auditors' Report ...................................................... 31

Balance Sheet ......................................................... 34

Profit & Loss Account ............................................. 35

Cash Flow Statement .............................................. 36

Schedules ............................................................... 37

2 Notice 02-07.p65 8/5/2010, 12:54 PM2

3

Notice is hereby given that the twenty-secondAnnual General Meeting of Indraprastha MedicalCorporation Limited will be held on Friday,10th September, 2010 at 12.15 p.m. at FICCIGolden Jubilee Auditorium, Federation House,Tansen Marg, New Delhi – 110001, to transact thefollowing business:

ORDINARY BUSINESS:

1. To receive, consider and adopt the AuditedBalance Sheet as at 31st March, 2010 and theProfit & Loss Account for the year ended on thatdate together with the Report of Directors’ andAuditors’ thereon.

2. To declare dividend on shares.

3. To elect a Director in place of Ms. SuneetaReddy who retires by rotation and being eligible,offers herself for re-election.

4. To elect a Director in place of Ms. Renu S.Karnad who retires by rotation and beingeligible, offers herself for re-election.

5. To elect a Director in place of Mr. Satnam Arorawho retires by rotation and being eligible, offershimself for re-election.

6. To consider and, if thought fit, to pass, with orwithout modifications, the following resolutionas Special Resolution:

“RESOLVED THAT pursuant to the provisions ofSection 224A and other applicable provisions,if any, of the Companies Act, 1956, M/s. S. C.Vasudeva & Co., Chartered Accountants, beand is hereby appointed as Auditors of theCompany to hold office from the conclusion ofthis Annual General Meeting of the Companyuntil the conclusion of the next Annual GeneralMeeting of the Company at a remuneration ofRs. 12.00 lacs plus out of pocket expenses.”

SPECIAL BUSINESS:

7. To consider and, if thought fit, to pass, with orwithout modifications, the following resolutionas Ordinary Resolution:

“RESOLVED THAT Mr. Rajendra Kumar be andis hereby appointed as Director of the Company,who shall be liable to retire by rotation.”

8. To consider and if thought fit, to pass with orwithout modification, the following as anOrdinary Resolution:

NOTICE“RESOLVED THAT pursuant to the provisions ofSection 257 and other applicable provisions,if any, of the Companies Act, 1956,Mr. T. S. Narayanasami be and is herebyappointed as Director of the Company whoshall be liable to retire by rotation.”

By order of the Board

for Indraprastha Medical Corporation Limited

Ajay Kumar SinghalPlace: New Delhi Vice President cumDate: 28th July, 2010 Company Secretary

NOTES:

1. A member entitled to attend and vote at themeeting is entitled to appoint a proxy to attendand vote at the meeting instead of himself andthe proxy need not be a Member of the Company.The instrument appointing proxy, in order to beeffective, must be deposited at the RegisteredOffice of the Company at least 48 hours beforethe commencement of the meeting.

2. Corporate members intending to send theirauthorised representatives to attend theMeeting are requested to send to the Companya certified copy of the Board Resolutionauthorising their representative to attend andvote on their behalf at the Meeting.

3. In terms of Article 110 of the Articles ofAssociation of the Company, read with Section256 of the Companies Act, 1956, Ms. SuneetaReddy, Ms. Renu S . Karnad, Mr. V. R. Reddyand Mr. Satnam Arora, Directors retire byrotation at the ensuing Annual General Meeting.

Mr. V. R. Reddy has conveyed his unwillingnessto offer himself for re-appointment, hence hewill cease to be Director of the Company atthe ensuing Annual General Meeting. Anotice has been received from a memberpursuant to Section 257 of the CompaniesAct, 1956, proposing the appointment ofMr. T. S. Narayanasami as a Director of theCompany, liable to retire by rotation.

2 Notice 02-07.p65 8/5/2010, 12:54 PM3

4


Ms. Suneeta Reddy, Ms. Renu S. Karnad andMr. Satnam Arora, being eligible, have offeredthemselves for re-appointment.

The information on the particulars ofthe Directors seeking appointment /re-appointment, as required under clause 49of the Listing Agreement, has been attachedhereto.

The Board of Directors of the Companycommends their respective appointment /re-appointments.

4. The relevant Explanatory Statement pursuantto Section 173 (2) of the Companies Act, 1956,relating to the Special Business to be transactedat the meeting, is annexed hereto.

5. The Register of Members and Share TransferBooks of the Company shall remain closed fromWednesday, 1st September, 2010 to Friday,10th September, 2010 (both days inclusive).

6. Dividend, if declared, will be paid to thosemembers whose names appear :-

a) as Members on the Register of Membersof the Company as on 10th September,2010, after giving effect to all valid sharetransfers in physical form lodged with theCompany up to the closing hours ofbusiness on 31st August, 2010, and

b) as Beneficial owners as per the Statement ofBeneficial Ownership to be furnished byNational Securities Depository Limited (NSDL)and Central Depository Services (India)Limited (CDSL) in respect of the shares heldin dematerialized form as at the closing hoursof business on 31st August, 2010.

5. Securities & Exchange Board of India (SEBI)has made trading in the shares of the Companycompulsory in dematerialized form for allinvestors. Members are requested to open anaccount with a Depository participant, if notdone so far and dematerialize theirshareholding to avoid inconvenience in future.

6. To avoid the incidence of fraudulentencashment of the Dividend warrants,Members, holding shares in physical form, arerequested to intimate the Company under thesignature of the Sole/First Joint holder, thefollowing information, so that the Bank Account

Number and Name and Address of the Bankcan be printed on the Dividend Warrant:-

1) Name of Sole/ First Joint Holder and FolioNo.

2) Particulars of Bank Account, viz.

i) Name of the Bank

ii) Name of Branch

iii) Complete address of the Bank with PinCode Number

iv) Account Type, whether savings (SB) orCurrent Account (CA)

v) Bank Account Number allotted by theBank.

7. Shareholders desirous of availing the facilitiesof Electronic Credit of Dividend are requestedto submit ECS form duly filled in. ECS form canbe obtained from the Registered Office of theCompany.

8. Members holding shares in electronic form maynote that bank particulars registered againsttheir respective depository accounts will beused by the Company for payment of dividend.The Company or its Registrars can not act onany request received directly from the membersholding shares in electronic form for any changeof bank particulars or bank mandates. Suchchanges are to be advised only to theDepository Participant of the members.

9. Non-Resident Indian Members are requestedto inform immediately of:-

a) Change in their residential status on returnto India for permanent settlement and

b) Particulars of their bank account maintainedin India with complete name, branch,account type, account number and addressof the bank with pin code number, if notfurnished earlier.

10. Pursuant to the provisions of Section 205A(5)and 205C of the Companies Act, 1956, theCompany has transferred unpaid or unclaimeddividend for the financial year 2000-01 &2001-02, to the Investor Education andProtection Fund (IEP Fund) of the CentralGovernment. The unpaid or unclaimed dividendfor the financial year 2002-03, shall be due to betransferred to the IEP Fund on 5th October, 2010.

2 Notice 02-07.p65 8/5/2010, 12:54 PM4

5

No claim shall lie from a Member against theCompany or the said Fund once the transfer ismade to the said Fund and no payment shallbe made in respect of any such claims.Members who have not encashed theirdividend warrant(s) so far for the financial yearended 31st March, 2003 or any subsequentfinancial year(s), are requested to make theirclaim to the Company Secretary at theregistered office of the Company, before suchtransfer to the said Fund, in their own interest.

11. In terms of Section 109(A) the Companies Act,1956, the Shareholder of the Company maynominate a person to whom the shares held byhim/her shall vest in the event of his/her death.In case, any member wishes to avail thenomination facility in respect of shares held byhim/her, please write to the Company to obtainthe nomination form.

12. Members holding shares in physical form arerequested to notify immediately the change intheir address, if any, to our Registrar & ShareTransfer Agent M/s. Link Intime India Pvt. Ltd.,A-40, 2nd Floor, Near Batra Banquet Hall, NarainaInd. Area, Phase – II, New Delhi – 110 028.

13. Shareholders seeking any information withregard to accounts are requested to write tothe Company at least seven days in advanceso as to enable the Company to keep theinformation ready.

14. Members are requested to bring their copy ofAnnual Report and Attendance Slip duly filledat the meeting.

INFORMATION REQUIRED TO BE FURNISHEDIN PURSUANCE OF CLAUSE 49 OF THE LISTINGAGREEMENT WITH STOCK EXCHANGES

The particulars of the Directors who are proposedto be appointed / reappointed are as given below:

1. Name : Ms. Suneeta Reddy

Age : 51 years

Qualification : Bachelor of Arts in Economics,Public Relations and Marketing,Diploma in Financial Managementand completed the Owner /President ManagementProgram at Harvard BusinessSchool, Boston (USA).

Expertise : Ms. Suneeta Reddy holds the positionof Executive Director-Finance of the ApolloHospitals Enterprise Limited - one of the leadinghealthcare organization in the World with over 8000beds across 44 locations.

During her 26 year tenure, Ms. Reddyspearheaded many initiatives in the healthcare,hospitality and is an active member of industrybodies representing the healthcare sector. She iswidely recognized for her contribution to the Indianhealthcare industry and has held leadershippositions including Co-Chairperson of HealthcareSub Committee - Confederation of Indian Industry(CII) and a member in National Committee onHealthcare.

Outside Directorship :

Aircel Limited.Aircel Cellular LimitedDishnet Wireless LtdApollo Hospitals Enterprise LimitedPCR Investments Ltd.Apollo Sindoori Hotels Ltd.Apollo Gleneagles Hospitals LtdApollo Hospitals (UK) Ltd.Apollo Munich Health Insurance Company LtdIndian Hospitals Corporation Ltd.Imperial Cancer Hospital & Research Centre Ltd.Universal Quality Services LLC.Apollo Infrastructure Project Finance Co. LtdVasumathi Spinning Mills LtdApollo Hospitals International Ltd. (AlternateDirector)Kalpatharu Infrastructure Development Co. Pvt. LtdPDR Investments Pvt. Ltd.Sindya Aqua Minerale Pvt. Ltd.Prescient Consulting India Private Ltd.FSM Labs Services Private Ltd.Sindya Securities & Investments Co. Pvt. LtdWestern Hospitals Corporation Private LtdDeccan Digital Networks Private Ltd.Kalpatharu Enterprises Private Limited.Sindya Infrastructure Development Company Pvt.Ltd.Marakkanam Port Company Private LtdSindya Builders Private LimitedTharani Energy India Pvt LtdSindya Properties Private Ltd.Faber Sindoori Management Services Pvt LtdHealth Superhiway Private LtdQuintiles Phase One Clinical Trials India Pvt Ltd.

2 Notice 02-07.p65 8/5/2010, 12:54 PM5

6


Membership of Committees of the Board ofother Companies : Investor Grievance Committee(Apollo Hospitals Enterprise Ltd.) - Member

Shareholding in the Company : 1,38,293Shares

2. Name : Ms. Renu S. Karnad

Age : 58 years

Qualification : Bachelor in Law, Masters inEconomics

Expertise : Ms. Renu S Karnad, Managing Directorof Housing Development Finance Corporation Ltd.(HDFC), is a graduate in law from the University ofMumbai and holds a Master’s degree in economicsfrom the University of Delhi. She is a Pravin Fellow– Woodrow Wilson School of International Affairs,Princeton University, USA. She is a former Presidentof the International Union for Housing Finance. Shehas been employed with HDFC since 1978. Apartfrom HDFC, Ms. Karnad is on the board of severalHDFC group companies and a number of otherleading corporations.


BOSCH Ltd.Credit Information Bureau (India) Ltd.GRUH Finance Ltd.Housing Development Finance Corp. Ltd.HDFC Asset Management Co. Ltd.HDFC Bank Ltd.HDFC ERGO General Insurance Co. Ltd.HDFC Property Ventures Ltd.HDFC Venture Capital Ltd.HDFC Standard Life Insurance Co. Ltd.ICI India Ltd.Sparsh BPO Services Ltd.Feedback Ventures Pvt. Ltd.G4S Corporate Services (India) Pvt. Ltd.HDFC Sales Pvt. Ltd.Value and Budget Housing Corporation (India) Pvt.Ltd.Transunion LLC – ChicagoHDFC PLC. - Maldives

Membership of Committees of the Board ofother Companies :

Audit Committee { Credit Information Bureau (India)Ltd.} - Chairperson

Audit Committee (HDFC ERGO General InsuranceCompany Ltd.) – MemberAudit Committee (ICI India Ltd.) – ChairpersonAudit Committee (BOSCH Ltd.) – ChairpersonShareholders’/Investors’ Grievance Committee(BOSCH Ltd.) - Member

Shareholding in the Company : Nil

3. Name : Mr. Satnam Arora

Age : 61 years

Qualification : Masters in Economics

Expertise : Mr. Satnam Arora has rich and variedexperience in managing business in variousindustries. He is the Managing Director ofM/s. Kohinoor Foods Limited which is a 750 croresturnover food company with world famous“Kohinoor” brand of basmati rice. This brand ofbasmati rice is available in about 60 countriesaround the world and also has the dominance inthe Indian market. He has extensively traveledaround the globe and has been instrumental insetting up various operations of the Companyoverseas. He has been involved in the familybusiness of rice trading right from the verybeginning. With a combination of intelligence andrich experience, he has been influential in creatingand systematizing the financial and marketingdepartments at Kohinoor Foods Limited. In hiscurrent capacity, he is involved with providingstrategic direction to the exports business of thecompany and provides marketing inputs to theCompany’s Subsidiaries and Joint VentureOperations in overseas market. His penchant fortaking on challenges in life motivated him to identifyand develop several new export markets in variouscountries.


Kohinoor Foods LimitedSatnam International Pvt. Ltd.Satnam Haegens LimitedSachdeva Brothers Pvt. Ltd.Sara Textiles LimitedKohinoor Foods Inc., USA

Membership of Committees of the Board ofother Companies : Share TransferCommittee (Kohinoor Foods Ltd.) - Member


2 Notice 02-07.p65 8/5/2010, 12:54 PM6

7

4. Name : Mr. Rajendra Kumar

Age : 43 years

Qualification : Bachelor of Technology from IndianInsitute of Technology, KanpurMaster in DevelopmentManagement, Asian Institute ofManagement Manila, PhillppinesIndian Administrative Services (IAS)

Expertise : Mr. Rajendra Kumar has joinedIndian Administrative Services in the year 1989 andwas involved in execution of various important projectsin various departments. During his more than 20years of service, he has extensive experience inpublic administration, having held several seniorposts in the State of Delhi, Union Territory of Andamanand Nicobar Island and Govt. of Mizoram. He haswon the Prime Minister's Award for Excellence inPublic Administration on 21st April, 2008, CivilServices Day. Presently, he is posted as Secretary,Health and Family Welfare, Govt. of Delhi.

Outside Directorship : Indraprastha Energy &Waste Management Company Private Limited.

Membership of Committees of the Board ofother Companies : None

Shareholding in the Company : NIL

5. Name : Mr. T.S. Narayanasami

Age : 61 years

Qualification : B. Sc.

Expertise : Mr. T.S. Narayanasami has over fourdecades of experience in the banking / financialsector. Presently, he is the Managing Director &CEO of United Stock Exchange of India Limited. Heretired from his services as the Chairman &Managing Director, Bank of India in May, 2009. Healso served as the Chairman of the Indian Bank’sAssociation. Prior to leaving the services of Bank ofIndia, he held the position of Chairman & ManagingDirector, Indian Overseas Bank, Chairman &Managing Director, Andhra Bank and ExecutiveDirector, Punjab National Bank. Earlier, he startedhis career in Union Bank of India in 1969 and heldtop management positions. During his tenure inBank of India, the Bank had been rated as the “Bestperforming Bank” among all Public, Private andForeign banks for 2007-08 by Business Today –KPMG Survey, 2008, the “Best Bank (PSB) Award”at NDTV Leadership Award, 2008 and “Dun & BradStreet – Rolta Corporate Awards, 2008 (Top Indian

Company)”. He is also the recipient of prestigious“T.A. Pai Memorial Best Banker Award” by DelhiKannadiga, Kannada Monthly Magazine. He haswidely traveled abroad.


United Stock Exchange of India Ltd.Axis Asset Management Co. Ltd.ITI Ltd.Mahanagar Telephone Nigam Ltd. [MTNL]Central Depository Services (India) Ltd. [CDSL]Experion Credit Information Company of India Pvt. Ltd.

Membership of Committees of the Board ofother Companies : None


EXPLANATORY STATEMENT PURSUANT TOSECTION 173(2) OF THE COMPANIES ACT, 1956

ITEM NO. 7

Mr. Rajendra Kumar was appointed as an AdditionalDirector of the Company on 28th July, 2010. Pursuantto Section 260 of the Companies Act, 1956, Mr.Rajendra Kumar holds office only up to the AnnualGeneral Meeting. A notice has been received froma member pursuant to Section 257 of theCompanies Act, 1956, proposing the appointmentof Mr. Rajendra Kumar as a Director of theCompany, liable to retire by rotation.

Except Mr. Rajendra Kumar, no other Director isinterested in the aforesaid resolution.

The Board of Directors of the Company commendsthe resolution for approval of the members.

ITEM NO. 8

Mr. V. R. Reddy, Directors retires by rotation at theensuing Annual General Meeting. Mr. V. R. Reddy hasconveyed his unwillingness to offer himself for re-appointment, hence he will cease to be Director of theCompany at the ensuing Annual General Meeting.

To fill up the vacancy caused by the retirement ofMr. V.R. Reddy, the Company proposes to appointMr. T.S. Narayanasami as the Non-ExecutiveIndependent Director of the Company. A notice hasbeen received from a member pursuant to Section257 of the Companies Act, 1956, proposing theappointment of Mr. T.S. Narayanasami as a Directorof the Company, liable to retire by rotation.

None of the Directors is concerned or interested inthis resolution.

The Board of Directors of the Company commendsthe resolution for approval of the members.

2 Notice 02-07.p65 8/5/2010, 12:54 PM7

8


The Directors take pleasure in presenting the22nd Annual Report of the Company alongwith the audited accounts for the year ended31st March, 2010.

FINANCIAL RESULTS(Rs. in Lakhs)

Particulars Year ended Year ended31-03-2010 31-03-2009

Total Income 43,647.98 40,588.34Profit before tax 4,655.27 3,725.32Provision for taxation 1,549.26 1,336.62Net Profit (PAT) 3,106.01 2,388.70Balance brought forwardfrom previous year 2,687.76 2,032.86Amount available forappropriation 5,793.77 4,421.56AppropriationsTransferred to GeneralReserve 250.00 125.00Dividend (Proposed) 1,466.77 1,375.10Corporate Dividend Tax 249.28 233.70Balance carried toBalance Sheet 3,827.72 2,687.76

TRANSFER TO RESERVES

The Company proposes to transfer Rs. 250.00 lakhsto the General Reserve out of the amount availablefor appropriations and an amount of Rs. 1,139.96lakhs is proposed to be retained in the Profit andLoss Account.

DIVIDEND

The Directors are pleased to recommend paymentof dividend on equity shares @ Rs. 1.60 per share(16%) for the financial year ended 31st March, 2010(previous year Rs. 1.50 per share).

OPERATIONS

During the year under review, the total income ofthe Company increased to Rs 436.47 crores fromRs 405.88 crores in the previous year – an increaseof 7.5%. The profit after tax stood at Rs. 31.06 croresagainst Rs. 23.89 crores in the previous year – agrowth of about 30%.

DIRECTORS' REPORT

Dear Shareholders

The operational performance details ofIndraprastha Apollo Hospitals, New Delhi are asunder:-

2009-10 2008-09 GrowthNo. of In-patientAdmissions 36,583 34,496 6.05%Average Daily BedOccupancy 494 476 3.78%OPD - NewRegistrations 89,859 85,316 5.33%Health Checks 25,685 25,038 2.58%Cardiac Surgeries 2,007 2,343 (14.34%)Transplant Surgeries 268 216 24.07%Other Surgeries 13,915 12,809 8.64%Dialysis 22,883 20,754 10.26%No. of InternationalPatients 5,030 3,780 33.07%

HIGHLIGHTS OF THE YEAR 2009-10

It was a year of quiet consolidation throughoperational efficiencies. The net profit rose by animpressive 30% over the previous year, due tobetter expense management and streamlining ofprocesses and systems.

The robust growth in profits was also due to changein case mix. High end surgeries such as Livertransplants, joint replacement surgeries and gastro-intestinal surgeries registered impressive growth.

The Multi Organ Transplant unit of the Hospitalperformed 268 organ transplants in the financialyear 2009-10 (117 liver and 151 kidney transplants),an increase of 34% in liver transplants and 17% inkidney transplants compared to the previous year.With 90% success rate, the outcomes in the livertransplant program are commendable andcomparable to the best centres in the world.

Indraprastha Apollo Hospitals introducedEndoscopic Ultra Sonology (EUS), a majoradvancement in diagnosing and treating gastro-intestinal and pancreato-biliary diseases. This willfurther strengthen the Liver- Gastro and Oncologyunit at the Hospital, clearly ensuring leadershipposition. Going forward, the Hospital will continueto focus on Cardiology, Oncology, Orthopaedics,Transplants and Preventive Care.

3 Apolo-8-30.p65 8/5/2010, 12:54 PM8

9

The Bone Marrow Transplant program got initiatedby recruitment of a highly qualified specialist; thevascular surgery program got a big boost withjoining of another highly qualified doctor; similarlythe EUS super specialist also brings rich experiencefrom USA; likewise a dedicated cardiac electrophysiologist has bolstered the cardiology program.

Indraprastha Apollo Hospitals has been adjudgedas the joint winner of the FICCI HealthcareExcellence Awards in September 2009 in thecategories of “Best Hospital” and “Best PatientCare”. The Hospital has been consistently rankedamongst the best 10 hospitals in India by The WeekIMRB survey for the past few years.

The performance of the Noida Hospital alsoimproved. However, despite a rise in revenue, theHospital could not achieve profits mainly due tosteep rise in staffing costs.

FREE PATIENT FACILITY

In the year 1986, The Govt. of NCT of Delhi underthe direction of the then Prime Minister, had decidedto set up a multi speciality hospital in the incompletebuilding next to Indira Gandhi Indoor Stadium, NewDelhi which was lying unutilised for a long time.The Medical Department of the Govt. of NCT ofDelhi bought the incomplete building from DDA inMarch 1987 for setting up the Hospital and invitedproposals through an open advertisement from themedical services industry to establish and run thishospital. After examining all the proposals, the thenLt Governor discussed with the then Chief Secretaryand Health Secretary, Govt. of NCT of Delhi andwith the approval of the Ministry of Health & FamilyWelfare, Govt. of India, it was decided to establishthe multi speciality hospital as a joint ventureCompany with the Apollo Hospitals Group whichhad the experience of setting up a Super SpecialityTertiary Care hospital.

On this understanding, Indraprastha MedicalCorporation Limited (IMCL) was promoted in thejoint sector by the Govt. of NCT of Delhi and ApolloHospitals Group and was incorporated as PublicLimited Company on 16th March, 1988 to set up amulti super speciality hospital in Delhi namely“Indraprastha Apollo Hospitals”. The incompletebuilding as aforesaid was handed over to theCompany at a nominal lease rental of Rs. 1/- permonth. A Management Agreement was alsoentered on the same date between Indian HospitalCorporation Ltd. (an Apollo Hospitals Group

Company) and Indraprastha Medical CorporationLtd. for providing technical and managementservices to the Company at a nominal managementfee of Rs. 1/- per annum.

This was the first joint venture Company and a firstof its kind in Healthcare under the public-privatepartnership model.

Indraprastha Apollo Hospitals was to becommissioned as part of the Nehru CentenaryCelebrations in November, 1989. Apollo HospitalsGroup had committed to meet the deadline withinthe stipulated 12 – months and the work was inprogress at full pace. However, in April 1989, theconstruction work had to be stopped as the Govt.of India decided to allot the building to SportsAuthority of India (SAI) in lieu of the land andbuilding acquired, the SAI undertook to pay Rs.15.478 crores to the company. This sum, togetherwith the interest accrued, was then to be used forconstructing the hospital at a new site.Subsequently, 15 acres of land at Delhi MathuraRoad, Sarita Vihar, New Delhi, together with buildingconstructed out of the money (including interest)received from Sport Authority of India was leasedto the company for a period of thirty years uptoJuly 31, 2023 renewable for a further period of thirtyyears on the same terms and conditions as agreedbefore.

The Hospital was inaugurated in July 1996 andcommenced various services in a phased manner.

Indraprastha Apollo Hospitals today offers a verydistinct ‘case mix’, comprising many complexprocedures, not usually available in many tertiarycare centres in the country. The level of advancedtechnology and specialist skills that are availabletoday were not even thought of 20 years ago whenthe joint venture Agreement with Govt. of NCT of Delhiwas signed by Apollo Hospitals Group. The hospitaltoday has several firsts and is recognised as amajor referral tertiary care hospital in the country.

As per the terms of the lease deed, the Companyshall admit free of charge such patients as may berecommended by the Lt. Governor of the NationalCapital Territory of Delhi or any Officer dulyauthorised by him in writing in this behalf upto1/3rd (one third) of the bed strength consisting of600 beds or such number of beds as near theretoas may be commissioned for the time being,earmarked for such purpose by the Company. TheCompany shall provide free diet, medical diagnostic

3 Apolo-8-30.p65 8/5/2010, 12:54 PM9

10


and such other facilities to the patients aforesaidas are required by the patients for indoor treatment.The Company shall also provide free medical,diagnostic and other facilities for not less than 40%of its out-door patients.

There was also an implied obligation on accountof custom duty exemption for import of medicalequipment prevailing at the time when the Hospitalproject was conceived. However, the hospitalcould not avail the benefits due to relocation ofthe project and consequent time delay duringwhich period the custom duty exemption on importof medical equipment was withdrawn by the Govt.of India vide notification no. 99/94 dated01.03.1994.

A Public Interest Litigation (PIL) was filed in the year1997 in the High Court of Delhi for seeking directionthat the Company should also provide freemedicines and medical consumables to thepatients referred by the Govt. of NCT of Delhi forfree treatment in the Hospital. The Petition wascontested by the Company.

An interim order dated 29.5.1998 was issued bythe Hon’ble High Court of Delhi and accordinglythe Hospital has been providing free treatmentexclusive of medicines & medical consumables topatients referred by the Govt. of NCT of Delhi.

The Delhi High Court decided the PIL vide its orderdated 22nd September, 2009, and has held that freetreatment provided by the Hospital as per the termsof the lease deed shall be inclusive of medicinesand consumables.

The Company has filed a Special Leave Petition(SLP) before the Hon’ble Supreme Court of Indiaagainst the impugned judgment and order of theHon’ble High Court of Delhi. The Hon’ble SupremeCourt of India has admitted the SLP and passedan interim order on 30.11.2009. In pursuance ofthe interim order, the Hospital is providing freetreatment to the patients referred by the Govt. ofNCT of Delhi exclusive of medicines & medicalconsumables. The matter is pending before theSupreme Court of India.

FOCUS ON QUALITY

Indraprastha Apollo Hospitals is distinguished byits focus on Clinical Excellence. It hasparticipated in one of the most importantprograms of the Apollo Hospitals Group known

as ACE@25 - a unique clinical balancedscorecard focusing on evidence based qualitycare and a safe environment for patients. Thescorecard measures 25 clinical parameters everymonth, benchmarking them against the bestinstitutions in the world and scores them on a 4point scale, colour coded as green, orange orred. Each of the participating hospitals is thusmeasured on a 100 point score and reportedonline for monitoring and sharing of bestpractices. A score of 75 and above is consideredgood performance and in the green zone. Theaverage ACE @ 25 score for the IndraprasthaApollo Hospitals this year has been 76.66.

With sustained efforts, the Average Length of Stay(ALOS) of patients in the Hospital was broughtdown from 5.09 days to 4.8 days. A number ofother initiatives were also undertaken in criticalareas of hospital operations directly impactingpatient care. The Voice of the Customer programwas further strengthened to ensure and monitorprompt action on customer feedback. The averageturn around per dialysis chair per day has alsogot increased.

Being the first hospital in the country to get JointCommission International(JCI) accreditation,Indraprastha Apollo Hospitals has always strivedto ensure all quality norms are being met. Tore-orient all the staff on JCI Standards, refreshersessions were conducted. The Hospital conductedquality audits twice during the year with a team ofexternal auditors to make sure that all standardswere complied with.

The Hospital successfully obtained re-accreditationunder ISO 14001:2004 Environment ManagementSystem in September 2009.

This year Indraprastha Apollo Hospitals continuedto build on the strategy of focusing on the ApolloCenters of Excellence, with Orthopedics beingidentified as a key area. Anticipating jointreplacement surgeries (particularly kneereplacements) as a high growth area, the Hospitaldid a number of activities to increase the numbersof knee replacement surgeries. The Apollo KneeClinics was set up in November 2009, followed bya focused marketing campaign through hoardings,posters and hand outs. Following these initiatives,significant growth in the number of surgeries wererecorded.

3 Apolo-8-30.p65 8/5/2010, 12:54 PM10

11

INFORMATION TECHNOLOGY INITIATIVES

During the year, your hospital invested in a numberof IT solutions that not only resulted in bettermanagement but also resulted in substantialsavings.

PACS::::: The X-Rays and CT scans went filmlessleading to easier access to the images andreducing consumption of films in the processleading to substantial savings.

Interfacing Medical equipments: A number ofequipments in the Laboratories were interfaced withthe Hospital Information System. Final calibrationand validation is now in progress.

On the Web: In keeping with changing times, theHospital has now got connected with its patronsover social networking website Twitter and keepsthem updated with latest developments.

Web Applications: A Visitor Management systemusing touch screen kiosks, an online KeyManagement system to improve the security andhandling of hospital keys and a web basedapplication for Wage & Salary administration wereintroduced. An e-based Leave ManagementModule was also implemented, thus savingconsiderable man-hours and stationery costs.

CORPORATE SOCIAL RESPONSIBILITY (CSR)

Indraprastha Apollo Hospitals remainedcommitted to social welfare and conductednumerous initiatives to improve the well-being ofthe community. A few of these are highlightedbelow:

• Billion Hearts Beating: Indraprastha ApolloHospitals participated in a social welfarecampaign launched by the Apollo HospitalsGroup in collaboration with Times of India toincrease awareness of Heart Disease. Theprogram received an overwhelming response.

• Wellness Workshops: During the year, theHospital conducted a number of health andwellness camps on various topics, sensitizingthe community as well as providing free checkups.

• On-site medical back-ups: For a number ofexhibitions, expos, sports meets, including theAuto Expo, IPL-3 and World Cup Hockey, yourhospital took on the responsibility of providingemergency and medical coverage.

• Pandemic Preparedness: an eight bed H1N1isolation unit and a screening centre were setup in the Hospital to help in tackling the H1N1pandemic. The unit conforming to allinternational infection control standards, wasamongst the first private hospitals to be grantedpermission to treat such patients. More than300 patients has been screened and125 patients has been admitted in the isolationunit. The Hospital conducted a number ofawareness programs and talks as well.

As part of the hospital’s ongoing commitment tocreating health awareness and providing preventivecare to the general public, Indraprastha ApolloHospitals hosted 11 workshops on key health issuesincluding tuberculosis, stress management, organdonation and transplantation, asthma, stroke,respiratory disorders wellness and knee pain.Further, Indraprastha Apollo Hospitals, through themobile health scheme service, which is done incollaboration with the Delhi Government in fiveeconomically depressed areas in the city, screenedand treated almost 20,000 patients in 2009-2010.The hospital conducted 111 free camps in Delhiand the neighboring states, providing free checkups and basic treatment to an additional 15,681people in 2009-2010. This year the Hospital willextensively conduct heart and cancer screeningprograms across the country.

INSTITUITIONAL IMPLANTS

To boost the concept of medical care in the area ofprofessional workforce and educational institutions,the concept of Apollo Occupational Health Centerslocated within a corporate or educational facilityhas been operational in Delhi & NCR. This year sawa surge in such Centers, also known as Implants,with new centers being set up in ComputerSciences Corporation, French School, Lotus ValleySchool and Genpact.

FACILITY UPGRADATION & EXPANSION

Significant renovation and upgradation work wascompleted during the year, which should add topatient comfort and help achieve more operationalefficiencies. Among others, a new orthopaedicsoperation theatre, a 5-bed ICU for critical cardiaccare patients, a 12 bed Multi Organ Transplant Unitfor Renal Transplant patients, a Mezzanine in theatrium for ICU patient attendants and internationalpatient lounge were commissioned.

3 Apolo-8-30.p65 8/5/2010, 12:54 PM11

12


Fifty eight patient rooms and three OPDs were alsorenovated during the year.

Indraprastha Apollo Hospital’s ambitious expansionplans indicate an impressive upward trajectory.Honouring its commitment to cater to theforthcoming Commonwealth Games, the hospitalwill commission an additional 136 beds in October,2010.

INFECTION CONTROL AND ENVIRONMENT

Infection Control is a significant constituent ofclinical care in health care setups. The improvementexhibited in the infection control indices continuedthis year as well. The infection rates are well withinacceptable standard level and favourablycompares with well established similar setups inthe western countries. The Hospital also partneredwith the WHO on World Hand Hygiene Day,spreading awareness on this crucial issue andaugmenting its implementation throughout healthcare workers and general public and other staffmembers.

CONSERVATION OF ENERGY

The Company on a continuous basis undertakesprograms for conserving energy. Plant maintenanceon a regular basis, review of energy generation andits consumption are among the measures adoptedtowards this end. Despite higher levels ofoccupancy, the expenditure on power and fuel hasdecreased over the previous year by around Rs.41 lakhs.

The following are some of the measures undertakenduring the period under review towards energyconservation:-

• All external lighting of the Hospital premiseshas been converted to LED type fixtureswhich is very low energy consuming.

• LED fixtures have been incorporatedthroughout the Hospital, wherever possible,to reduce electric consumption.

• Variable frequency drivers have beeninstalled in the air conditioning system toreduce the energy consumption.

• Push type water taps have been installed inPublic Toilets in the Hospital to reduce waterwastage.

Training programmes for creating awareness aboutconservation of energy and natural resources arealso being done on a regular basis for employees.

TECHNOLOGY ABSORPTION

The Company continued to invest in cutting-edgetechnology to offer the latest in medical care andmaintain international standards. Among the newdevices and tests incorporated are:

Endoscopic Ultrasound( EUS):

Endoscopic ultrasonology is used to visualizeimage, take biopsy and also to treat diseases ofthorax and abdomen using an endoscopicallydirected ultrasound. A highly useful modality in thesuper specialty of gastroenterology and alsocatering to oncology, respiratory diseases andothers, the unit is being operated by a highly skilledconsultant, who has been trained in the US andhas more than a decade's experience.

Endo- vascular Laser:

Endovenous laser therapy (EVLT) is a non-surgical method of resolving the unsightly, painfuland potentially dangerous effects of varicoseveins (swollen veins) on legs. This minimallyinvasive procedure offers the latest advance inthe treatment of varicose veins. Some of thebenefits include short procedure time, localanesthesia, a day care procedure, lower risk ofcomplications, minimal scarring and fasterrecovery. A senior consultant who has recentlyjoined in vascular surgery, has special trainingand brings expertise in endovascular surgeryfrom the western centers.

DSA Lab:

The new DSA lab brings high resolution 3Dfunctionality, X-per CT function, providing accessto any blood vessel including those located indifficult areas, under image guidance thus providingrelief to many patients with aneurysms and AVmalformations. This facility is not available at mostcenters in India.

FOREIGN EXCHANGE EARNINGS & OUTGO

(a) Activities relating to exports; initiativestaken to increase exports; development ofnew export markets for products andservices; and export plans

The Company is engaged in the healthcarebusiness and is not carrying on any exportactivities. The Hospital has been empanelledwith eminent international insurance companiesand appointed healthcare facilitators in variouscountries to cater to international patients.

3 Apolo-8-30.p65 8/5/2010, 12:54 PM12

13

(b) Total Foreign Exchange Earnings and Outgo

During the year under review, foreign exchangeearnings and outgo were as under:-

Earnings : Rs. 40.07 crores

Outgo : Rs. 14.05 crores

PARTICULARS OF EMPLOYEES

The Particulars of employees as per Section217 (2A) of the Companies Act, 1956 read withthe Companies (Particulars of Employees)Rules, 1975 are annexed and form part of thisreport.

DIRECTORS’ RESPONSIBILITY STATEMENT

As required under Section 217(2AA) of theCompanies Act, 1956, your Directors state:

(i) that in the preparation of the annual accounts,the applicable accounting standards have beenfollowed;

(ii) that appropriate accounting policies have beenselected and applied consistently and havemade judgments and estimates that arereasonable and prudent so as to give a trueand fair view of the state of affairs of theCompany as on 31st March, 2010 and of theprofit of the Company for the year ended31st March, 2010.

(iii) that proper and sufficient care has been takenfor the maintenance of adequate accountingrecords in accordance with the provisions ofthe Companies Act, 1956 for safeguarding theassets of the Company and for preventing anddetecting fraud and other irregularities;

(iv) that the annual accounts have been preparedon a going concern basis.

CORPORATE GOVERNANCE

Pursuant to Clause 49 of the Listing Agreement, aManagement Discussion and Analysis Report anda Report on Corporate Governance is attached withthis Report.

A Certificate from the Statutory Auditors of theCompany regarding the Compliance by theCompany of the conditions stipulated under Clause49 of the Listing Agreement is also attached withthis report.

A declaration by the Managing Director pursuantto clause 49(I)(D)(ii) of the Listing Agreement stating

that all the Board Members and SeniorManagement Personnel of the Company haveaffirmed compliance with the Code of Conduct,during the financial year ended 31st March, 2010,is also attached with this report.

AUDITORS / AUDITORS’ REPORT

M/s. S. C. Vasudeva & Co., Chartered Accountants,Auditors of the Company shall hold office until theconclusion of the ensuing Annual General Meetingand are eligible for re-appointment.

The Company has received a letter fromM/s. S. C. Vasudeva & Co., Chartered Accountants,to the effect that their appointment, if made, wouldbe within the prescribed limits under Section 224(1-B) of the Companies Act, 1956. The Board ofDirectors recommends the appointment ofM/s. S. C. Vasudeva & Co., Chartered Accountantsas Auditors of the Company.

DIRECTORS

Mr. V. V. Bhat ceased to be a Director of theCompany, consequent upon his transfer from theoffice of Principal Secretary - Finance, Govt. ofDelhi.

Mr. Rajendra Kumar, Secretary, Health & FamilyWelfare, Govt. of Delhi was appointed by the Boardas an Additional Director of the Company. Pursuantto Section 260 of the Companies Act, 1956, Mr.Rajendra Kumar holds the office of Director onlyup to the date of the Annual General Meeting ofthe Company. A notice has been received from amember pursuant to Section 257 of the CompaniesAct, 1956, proposing the appointment of Mr.Rajendra Kumar as a Director of the Company,liable to retire by rotation.

In accordance with the provisions of the CompaniesAct, 1956 and the Articles of Association of theCompany, Ms. Suneeta Reddy, Ms. Renu S.Karnad, Mr. V. R. Reddy and Mr. Satnam Arora,Directors of the Company shall retire by rotation atthe ensuing Annual General Meeting.

Mr. V. R. Reddy has conveyed his unwillingness tooffer himself for re-appointment; hence he will ceaseto be Director of the Company at the ensuing AnnualGeneral Meeting. A notice has been received froma member pursuant to Section 257 of theCompanies Act, 1956, proposing the appointmentof Mr. T.S. Narayanasami as a Director of theCompany, liable to retire by rotation.

3 Apolo-8-30.p65 8/5/2010, 12:54 PM13

14


Ms. Suneeta Reddy, Ms. Renu S. Karnad andMr. Satnam Arora, being eligible, have offeredthemselves for re-appointment.

Resolutions seeking approval of the shareholdersfor the appointment / re-appointment of Directorshave been incorporated in the notice of the AnnualGeneral Meeting.

The information on the particulars of the Directorsseeking appointment / re-appointment, as requiredunder clause 49 of the Listing Agreement, has beenfurnished in the notice to the shareholders for theAnnual General Meeting.

Your Directors wish to place on record theirappreciation of the valuable services rendered byMr. V. V. Bhat and Mr. V. R. Reddy during theirtenure as a Director of the Company.

FIXED DEPOSITS

During the year under review, the Company hasnot accepted any deposit under Section 58A of theCompanies Act, 1956 read with Companies(Acceptance of Deposits) Rules, 1975.

INSURANCE

All properties and insurable assets of the Company,including Building, Plant & Machinery and Stockshave been adequately insured, wherevernecessary.

The Company also has a professional indemnityinsurance policy to cover the risk on account ofclaims filed against the Company in ConsumerCourts.

RESEARCH & DEVELOPMENT

The Company is running a multi super-specialtyHospital and is not engaged in any major research& development activity. However, the Hospitalcontinues to be a major centre for internationalclinical trials.

INDUSTRIAL RELATIONS

The Industrial Relations scenario continued to becordial during the year under review.

However, the proceedings of the labour and othercourt cases, which took place after the strike by asection of employees in the Hospital in September,1998 continued during the year.

ACKNOWLEDGEMENT

The Directors wish to thank and deeplyacknowledge the cooperation, assistance andsupport extended by the financial institutions,banks, the Govt. of Delhi and the UnionGovernment.

The Directors also wish to place on record theirappreciation for the all round support andcooperation received from the employees at alllevels and the consultant doctors.

For and on behalf of the Board

Place : New Delhi Rakesh MehtaDate : 28th July, 2010 Chairman

3 Apolo-8-30.p65 8/5/2010, 12:54 PM14

15

AN

NE

XU

RE

TO

DIR

EC

TO

R’S

RE

PO

RT

Info

rmat

ion

as p

er S

ectio

n 21

7 (2

A)

of th

e C

omp

anie

s A

ct, 1

956

read

with

the

Com

pan

ies

(Par

ticul

ars

of E

mp

loye

es)

Rul

es, 1

975

and

form

ing

par

t of t

he D

irect

or's

Rep

ort f

or th

eye

ar e

nded

31s

t Mar

ch, 2

010.

Nam

e o

f th

e E

mp

loye

e/D

esig

nat

ion

/Nat

ure

Qu

alif

icat

ion

Dat

e o

fR

emu

ner

atio

nL

ast

Em

plo

ymen

t h

eld

Ag

eo

f D

uti

es&

Exp

erie

nce

Com

men

cem

ent

Rec

eive

d (

Rs.

)o

f E

mp

loym

ent

(A)

Em

plo

yed

th

rou

gh

ou

t th

e ye

ar a

nd

in r

ecei

pt

of

rem

un

erat

ion

no

t le

ss t

han

Rs.

2,4

00,0

00/-

fo

r th

e ye

ar :

-

Mrs

. R

ajal

aksh

mi C

hand

ruG

ener

al M

anag

er-

B.S

c.(

Zoo

log

y) (

27

Yrs

)16

/8/1

995

2,49

3,00

4E

xecu

tive

Sec

reta

ry to

Cha

irman

,59

yea

rsP

atie

nt S

ervi

ces

Ap

ollo

Hos

pita

ls,

Che

nnai

Dr.

Ram

an S

ard

ana

Ad

dl.

DM

S c

umM

BB

S,

MD

(M

icro

bio

log

y)13

/11/

1995

3,24

3,98

1C

onsu

ltant

-Mic

rob

iolo

gy,

Cho

pra

48 y

ears

Sen

ior

Con

sulta

nt(2

2 Ye

ars)

Hos

pita

l & N

atio

nal P

aed

iatr

icC

entre

, Gul

moh

ar E

ncla

ve, N

ew D

elhi

Mr.

Aja

y K

umar

Sin

gha

lVi

ce P

resi

den

t cum

B. C

om, L

LB, F

CS

1/5/

1996

5,07

1,82

6P

ract

icin

g C

omp

any

Sec

reta

ry,

52 y

ears

Com

pan

y S

ecre

tary

(28

Year

s)N

ew D

elhi

Mr.

P S

hiva

kum

arVi

ce P

resi

den

t - F

inan

ceB

Com

, AC

A, G

rad

uate

28/4

/199

75,

119,

047

Man

ager

- F

inan

ce -

Pre

mie

r A

uto

45 y

ears

of IC

WA

I (22

Yea

rs)

Ele

ctric

al L

imite

d,

Che

nnai

Dr.

Anu

pam

Sib

alD

irect

or M

edic

al S

ervi

ces

MB

BS

, MD

(13

Yea

rs)

11/8

/200

27,

841,

111

Sen

ior

Con

sulta

nt -

Pae

dia

tric

,42

yea

rsG

astro

ente

rolg

y &

Hep

atol

ogy,

Ind

rap

rast

ha A

pol

lo H

osp

itals

,N

ew D

elhi

Mr.

Ani

l Mai

niP

resi

den

t - C

orp

orat

eB

A (

Hos

.), D

iplo

ma

in4/

4/20

056,

923,

103

Mar

ketin

g H

ead

- E

scor

t Hea

rt58

yea

rsD

evel

opm

ent

Mar

ketin

g M

anag

emen

t,In

stitu

te a

nd R

esea

rch

Cen

tre,

Man

agem

ent c

ours

e in

New

Del

hiS

enio

r E

xecu

tive

resi

den

t(3

1 Ye

ars)

Mr.

Jai

dee

p G

upta

Man

agin

g D

irect

orB

.Sc,

PG

Dip

lom

a in

29/4

/200

56,

628,

613

Vic

e P

resi

den

t - O

per

atio

ns, A

pol

lo46

yea

rsR

ural

Man

agem

ent

Hos

pita

ls E

nter

pris

e Li

mite

d,

(24

Year

s)K

uala

Lam

pur

(M

alay

asia

)

Ms.

Ush

a B

aner

jee

Dire

ctor

- N

ursi

ngB

.Sc

(Nur

sing

), M

BA

12/1

2/20

055,

050,

251

Dire

ctor

Nur

sing

- M

ax H

ealth

Car

e43

yea

rs(H

R &

Ind

ustr

ial R

elat

ions

),Li

mite

d,

New

Del

hiD

iplo

ma

in H

osp

ital

Ad

min

istr

atio

n. D

iplo

ma

inTr

aini

ng a

nd D

evel

opm

ent

(18

Year

s)

Mr.

Ash

oke

Cha

krab

artty

Dep

uty

Gen

eral

M.S

c. (

Ele

ctro

nics

)2/

7/20

072,

498,

810

Chi

ef B

iom

edic

al E

ngin

eer-

Max

47 y

ears

Man

ager

- B

io M

edic

al(2

2 Y

ears

)H

ealth

care

Inst

itute

Ltd

, New

Del

hi

(B)

Em

plo

yed

fo

r p

art

of

the

year

an

d in

rec

eip

t o

f re

mu

ner

atio

n a

gg

reg

atin

g n

ot

less

th

an R

s. 2

00,0

00/-

per

mo

nth

:- N

ON

E

Not

es :

Not

es :

Not

es :

Not

es :

Not

es :

1.R

emun

erat

ion

incl

udes

sal

ary,

allo

wan

ces,

Com

pan

y's

cont

ribut

ion

to P

rovi

den

t Fun

d a

nd m

onet

ary

valu

e of

per

qui

site

s an

d o

ther

ben

efits

as

valu

ed u

nder

Inco

me

Tax

Act

, 196

1.2.

Non

e of

the

emp

loye

es a

s m

entio

ned

ab

ove

is re

late

d to

any

Dire

ctor

of t

he C

omp

any

and

hol

ds

(by

him

self

or a

long

with

his

sp

ouse

and

dep

end

ant c

hild

ren)

mor

e th

an2%

of e

qui

ty s

hare

s of

the

Com

pan

y.

3 Apolo-8-30.p65 8/5/2010, 12:54 PM15

16


MANAGEMENT DISCUSSION AND ANALYSIS REPORT

Overview of the Business Environment, IndustryStructure and Current Developments in the Sector

Section I:The Economic Climate

Riding on the back of rapidly implemented stimuluspackages, the global economy began bouncingback from the severe financial crisis from the springof 2009. A large number of countries beganshowing positive quarterly growth of gross domesticproduct (GDP). The Indian economy too, whichsaw its GDP growth fall from the 9% levels of earlieryears to 7.1 %, saw a swing back to the pre-crisisgrowth figures. In fact, the International MonetaryFund raised India’s economic growth forecast for2010 to 9.4% in early July.

However, global forecasts are that the recovery hasreached its peak and with the fading impact ofstimulus packages, and return to normal monetarypolicies, the pace of growth will now slow down.According to a risk assessment report by EulerHermes, the world’s leading credit insurer, althoughAsian countries have withstood the crisis better andled the recovery, they will be unable to maintainthe impressive growth levels recorded in the firstquarter of 2010 out to 2011 and that businesseswill remain under pressure.

Section 2:The Healthcare Scenario

The global healthcare economy has always beenfairly resilient to recessions. This time round too,even as the weak economy was ravaging varioussectors, the healthcare industry remained largelyinsulated though not wholly untouched by some ofthe recessionary pressures.

In India, the healthcare industry is expected tocontinue its healthy rate of growth. According to areport released by ASSOCHAM-Yes Bank in the lastweek of November 2009, the Indian healthcaresector is expected to grow at 23% annually tobecome a $77 billion industry by 2010. Among all,the hospital industry is estimated to generate over$54.5 billion, thus contributing more than 70% ofthe total healthcare sector.

Overall, the Indian healthcare sector registered agrowth of 9.3% between 2000 and 2009,comparable to the sectoral growth rate of otheremerging economies such as China, Brazil and

Mexico. According to the Assocham-Yes Bankreport, the growth in the sector would be driven byhealthcare facilities -- both private and public,medical diagnostic and pathlabs as well as themedical insurance sector. It is estimated thatinsurance will touch the lives of 350 million Indiansby 2012 resulting in additional healthcareexpenditure of Rs 39,000 crores.

Rising population, increased income levels, thedesire for a better quality of life, which includessuperior healthcare facilities, shifts in disease profileand rise in corporate healthcare plans due to moreinsurance penetration are some of the other growthdrivers for the sector.

Other industry reports too corroborate the growthprojections. According to a CII survey of servicesindustries in India, in which responses of more than350 service related industry associations,organizations and companies in both the privateand public sectors from 51 sectors were taken,healthcare industry performed better during April-March 2009-10 over April-March 2008-09. The CIIsurvey found that healthcare was in the 10-20%high growth category. Already, revenues from thehealthcare sector account for 5.2% of the GDP,making it the third largest growing sector in India.

Section 3:Changing face of healthcare delivery

Over the years, the industry dynamics in thehealthcare sector have been fundamentallychanging. The application of newer technologiesand marketing strategies are transforminghealthcare delivery systems worldwide.

Technology is giving rise to new clinical therapieswhich in turn are addressing more and moremedical ailments and aiding in earlier diagnosis andprevention of diseases.

Another emerging trend is the paperless hospitalor digitized patient information that can beaccessed from numerous locations. Thus reportsdo not have to be processed and printed and canbe made available instantly and at multiplelocations.

Increasing digitization also helps in cost reduction.By streamlining operations and relying more ontechnology, the focus of corporate hospitals is toattempt to bring in cost efficiencies so that the rising

3 Apolo-8-30.p65 8/5/2010, 12:54 PM16

17

cost of healthcare delivery need not always bepassed on to patients.

Section 4:OPPORTUNITIES AND THREATS

OPPORTUNITIES

The changing socio economic mix in the country,with more people entering the middle class is goingto impact healthcare delivery in the country.

New paradigm of diseases

It is anticipated that the change in mix of diseases– a 50% rise in prevalence of lifestyle diseases isprojected – will lead to 12% increase in treatmentrate and 7% increase in price. This would lead to achange in the share of healthcare in GDP from5.2 % to 6.2%.

Cardiovascular Disease (CVD) has already emergedas the number one cause of death globally. By 2030,almost 23.6 million people will die from CVDs, mainlyfrom heart disease and stroke. The largest increasein number of deaths, it is estimated, will occur in theSouth-East Asia Region.

India will bear one of the heaviest burdens of heartdisease. What’s more worrying, the graph of heartdisease here shows that it is afflicting the young.Over 70 percent of heart attacks occur after 70 indeveloped countries, while two thirds of heartattacks in India occur below 60. Heart disease,strokes and diabetes cost India an estimated $9billion in lost productivity in 2005. The losses couldgrow to a staggering $200 billion by 2015 ifcorrective action is not taken quickly, says a studyby the New Delhi-based Indian Council forResearch on International Economic Relations. InApril 2010, preliminary results from a landmarkongoing study has proved beyond doubt thechanging profile of diseases in India. The MillionDeath Study, done by Centre for Global HealthResearch at the University of Toronto incollaboration with the Registrar General of India(RGI) and the Indian Council of Medical Research(ICMR), which is following the lives and deaths of1.1 million households throughout India until 2014has shown that heart attack is the number one killerdisease in India. The preliminary findings of thestudy have shown a reversal in disease patterns inthe country from communicable diseases to non-communicable or lifestyle diseases.

Medical Tourism

India continues to be a preferred destination formedical tourism. A McKinsey survey forecasts thearrival of foreign patients to expand at over 40%annually and this segment alone is expected torecord revenues of US$ 2 billion by 2012.

The outlook is buoyant for medical tourism due tohealthcare reforms in the US. As the US introducedlandmark changes in their healthcare system, withemphasis on increasing coverage, offshoring ofhealthcare revenue cycle management and servicesis set to gain traction. The healthcare reforms in theUS are expected to force suppliers and providersacross the health insurance space to identifyavenues for cost savings and India’s private hospitalsare well placed to capitalize on these opportunities.Not only do Indian hospitals have the ability toprovide quality medical care at a fraction of the cost,but they can provide quality care.

Rising investments in Indian Healthcare

In recent years, there have been significantinvestments from domestic players, financialinvestors as well as private equity firms in thecorporate healthcare sector in India.

Several factors have contributed to the investorinterest in this sector. Historically, there has beenunderinvestment in healthcare infrastructure,which means that India has been lagging behindin terms of availability of hospital beds – just 0.7beds per 1,000 population against a worldaverage of 4 beds per 1,000 population.Regulatory hurdles and unfavorable climate hadkept investors away from the sector. But now, withIndia’s changing economic position, risingincomes and consumer demand for betterhealthcare facilities as well as easier access tocapital, there’s been an about turn. Thegovernment impetus to the sector has helped too.There has been a four fold increase in theallocation to the ministry of health and familywelfare – from Rs 36,079 crore in the 10th Plan toRs. 140,135 crore in the 11th Plan. Besides,schemes such as the National Rural Health Missionand the proposed Urban Health Mission as wellas expected reforms in the healthcareinfrastructure development process through useof public private partnerships (PPPs) bode wellfor the sector.

3 Apolo-8-30.p65 8/5/2010, 12:54 PM17

18


According to an India Today cover story on thehealthcare boom (April 1, 2010) , PE firms investedRs 4,500 crore in Indian healthcare between 2006and 2010. According to a Venture Intelligence study,12 per cent of the US$ 77 million venture capitalinvestments in the July-September 2009 quarterwere in the healthcare sector. As part of its‘Healthymagination’ initiative, GE will spend US$3 billion over the next six years on research anddevelopment, provide US $2 billion of financing overthe next six years to drive healthcare informationtechnology and health in rural and under servedareas, and invest US$ 1 billion in partnerships,content and services.

Feedback Ventures expects PE funds to invest atleast US$ 1 billion in the healthcare sector in thenext five years.

THREATS

Inflationary trends, expected to escalate in a bigway after the oil price decontrol, can make animpact on the business. Increased competition inthe corporate healthcare sector where several newplayers have entered can also exacerbate staffingshortage.

Inflation: Spiralling prices have led to the increasein operating costs for the Company ranging fromsalaries, medical supplies, to general andadministrative costs. Costs of renovation andequipping hospitals with the latest technologieshave also risen adding to the cost burden.

Intensifying Competition: While there is room forgrowth in the healthcare sector in India, there arecertain pockets such as metro cities where there isnow the threat of oversupply. The IndraprasthaApollo Hospitals, however, has a strong brandimage and leadership position and is well equippedto face the growing competition.

Staffing shortage: Rising competition as well aslarge scale overseas migration of nursing staff hasled to an acute shortage of medical professionals.The Indraprastha Apollo Hospitals has howevertaken proactive measures by focusing on talentretention and attraction measures for doctors aswell as setting up training centres for nursingprofessionals to address the shortage. It hasmanaged to establish itself as an attractivedestination for returning NRI doctors.

Section 5:Indraprastha Medical Corporation Limited

The first internationally accredited hospital in India,Indraprastha Apollo Hospitals has always been atrendsetter when it comes to responsible healthcaredelivery. Not surprisingly, it has consistently beenranking among the Best Hospitals in the country insurvey after survey. The 2009 Week-IMRB annualsurvey of the best Hospitals in the country(November 2009) listed Indraprastha ApolloHospitals, Delhi in the top 10 list of hospitals.

Dr. Prathap C Reddy, Founder – Apollo HospitalsGroup was conferred the PADMA VIBHUSHANAWARD by the Government of India in recognitionof his contribution towards the healthcare industryin the country.

KEY STRENGTHS

The Indraprastha Apollo Hospitals is one of thestrongest healthcare brands in India today,signifying quality, innovation, internationalstandards and care. The hospital has some of themost experienced medical practioners and talentedadministrators in the country. Several of its doctorshave won top awards in their field this year.

Focus on operational efficiency and timely deliveryof quality care have ensured that the hospitalmaintains its leadership position.

The Hospital also enjoys a very high credit ratingfrom independent credit rating agency CRISIL andwill continue to attract funds for medium termloans.

Working on a fee for service model with its doctors,the hospital has managed to cement doctor-hospitalrelationship and retain its top doctors andspecialists.

Monitoring Clinical outcomes is a continuous andregular process at Indraprastha Apollo Hospitals.Efforts are constantly on to improve clinicaloutcomes and enhance the service delivery topatients.

OVERVIEW OF SEGMENT-WISE BUSINESSPERFORMANCE

The Company is engaged in healthcare business,which in the context of Accounting Standard 17issued by the Institute of Chartered Accountants ofIndia, is considered the only business segment.

3 Apolo-8-30.p65 8/5/2010, 12:54 PM18

19

Financial year 2009-10 represented a year ofconsistent performance by the Hospital and theCompany built on the strong foundation of growthlaid earlier.

FINANCIAL PERFORMANCE/OPERATIONALPERFORMANCE

During the year under review, the Company hasregistered all round growth in its working andachieved higher incomes and profit.

The total income of the Company for the year ended31st March 2010 stood at Rs 436.47 croresregistering a growth of 7.5% from the previous yearfigures of Rs. 405.88 crores.

The profit before tax was Rs. 46.55 crores ascompared to Rs. 37.25 crores in the previous year,registering a 24.9% growth.

The profit after tax was Rs. 31.06 crores ascompared to Rs. 23.89 crores in the previousfinancial year, a growth of 30%.

The Noida Hospital, in its fourth year of operation,registered a marginal growth in income fromRs. 10.20 crores in the previous year toRs. 12.40 crores this year. Although an aggressivegrowth rate was contemplated for the NoidaHospital during the financial year 2009-10, thiscould not be achieved due to staffing costs goingup by unanticipated levels.

Increase in high end cases, number of surgeriesand procedures, health checks, and internationalpatients combined with a good case mix and higheryield per patient were the key drivers for theremarkable growth in revenues and profits.

HUMAN RESOURCE DEVELOPMENT

For healthcare service delivery in India, findingtalent and retaining it is the biggest challenge asthere is a huge shortfall of doctors, nurses andparamedical staff in the country.

Indraprastha Apollo Hospitals has investedconsiderable energy and resource in identifying anddeveloping talent. It has invested in capabilitybuilding so that employees are not only trained tofollow JCI norms but are also aligned to thecompany’s vision and goals.

The total number of employees in the Company ason 31st March, 2010, was 2939. Besides this, thereare 347 Consultant Doctors who work on a ‘Fee forService’ basis. The Company has engagedcontractors for various support services in theHospital and they have deployed 900 workers.

OUTLOOK

The management depth and agility to constantlyreinvent itself has made Indraprastha ApolloHospitals become a preferred healthcare deliveryservice provider in the National Capital Region andits surrounding areas.

Domain expertise, focus on quality by seeking outinternational accreditation so as to be at par withinternational institutions, as well as engaging invarious risk related initiatives and activities tomitigate and treat reported risks are other factorsthat have led to the hospital maintaining itsleadership position.

The launch of the campaign Billion Hearts Beatingby Indraprastha Apollo Hospitals has touched achord with citizens and elicited tremendousresponse, contributing to the brand recall. Bygetting onto the social networking site, Twitter,Indraprastha Apollo Hospitals has established aninstant connect with its patrons, building trust andupdating them rapidly about developments.

There continues to be robust demand fromdomestic as well as international segments. WithIndraprastha Apollo Hospitals actively providingmedical back up facilities for major expositions andbig sporting events, it has enhanced the visibilityof the Company. The Commonwealth Games alsorepresent another such opportunity to deliver qualitycare.

The outlook for your Company certainly appearsbright since demand is robust and the industry isgaining momentum.

RISK AND CONCERNS

Staffing is a major concern for the healthcareindustry and corporate hospitals segment as such.With increased competition, talent retention hasbecome a challenge and resulted in increasedexpenditure. Thus, rising wage bills couldpotentially erode margins.

3 Apolo-8-30.p65 8/5/2010, 12:54 PM19

20


Technological obsolescence in medical equipmentis an ongoing risk that hospitals have to contendwith. To counter this, the hospital has buy-backarrangements with vendors for critical investments.

In a Public Interest Litigation (PIL) on free patientfacility in the Hospital, the Hon’ble High Court ofDelhi has held that free treatment provided by theHospital as per the terms of the lease deed shallbe inclusive of medicines and consumables.

The Company has filed a Special Leave Petition(SLP) before the Hon’ble Supreme Court of Indiaagainst the impugned judgment and order of theHon’ble High Court of Delhi. In pursuance of aninterim order dated 30th November 2009 by theHon’ble Supreme Court, the Company has beencharging for medicines and consumables from thepatients referred by Government of Delhi for freetreatment. Similar issue is also being contested inthe Supreme Court of India by some other hospitalsin Delhi who have been given land at concessionalrates.

The National Board of Examination (NBE) hasissued guidelines that the minimum stipend / salarypayable to a DNB trainee will be equal to the stipend/ salary paid by the Govt. of India / Govt. of NCT ofDelhi to their DNB Trainees in their respective yearof studies. The guidelines has been challenged bythe several hospitals in the city before the Hon’bleHigh Court of Delhi. If the Hon’ble Court eventuallyequates stipend / salary / allowances payable toDNB trainees in Government Hospitals with Privateinstitutions, it will have wide ramifications across alarge section of Hospital employees and may resultin a significant financial outflow.

INTERNAL CONTROL SYSTEMS AND THEIRADEQUACY

The Company has put in place adequate internalcontrols to ensure that assets are safeguarded andprotected against loss from unauthorized use ordisposition and the transactions are authorized,recorded and reported correctly.

The internal audit department together with anindependent firm of Chartered Accountants reviewsthe effectiveness of the systems and procedures.The internal auditors evaluate the adequacy of theinternal control systems by analyzing and testingcontrols and make their recommendations to themanagement to improve controls wherevernecessary.

CAUTIONARY STATEMENT

Statements in this Management Discussion andAnalysis describing the company’s objectives,projections, estimates and expectations mayconstitute “forward looking statements” within themeaning of applicable laws and regulations. Actualresults might differ materially from those eitherexpressed or implied.



3 Apolo-8-30.p65 8/5/2010, 12:54 PM20

21

(b) Names and Category of Directors, Attendance of each Director at the Board Meetings and the lastAnnual General Meeting

REPORT ON CORPORATE GOVERNANCE

The Names and Category of Directors on the Board, their attendance at the Board Meetings held during the financialyear ended 31st March, 2010 and at the last Annual General Meeting held on 9th September, 2009, are as under:-

Name of the Director Category Number of AttendanceBoard Meetings at the Last

attended AGM

Mr. Rakesh Mehta (Chairman) Non-Executive 5 YesDr. Prathap C Reddy (Vice-Chairman) Non-Executive 4 YesMr. Jaideep Gupta (Managing Director) (1) Executive 5 YesMr. V. V. Bhat (2) Non-Executive 2 YesMr. J. P. Singh (3) Non-Executive 2 YesDr. B.Venkataraman Non-Executive - Independent 3 YesLt. Gen. (R) Vijay Lall Non-Executive - Independent 5 YesMs. Suneeta Reddy Non-Executive 2 YesMs. Renu S. Karnad Non-Executive 2 NoMr. V. R. Reddy Non-Executive - Independent 1 NoMr. Satnam Arora Non-Executive - Independent 3 NoMr. Anil Kamineni (4) Non-Executive 4 YesMr. S. Regunathan (5) Non-Executive - Independent 5 NoProf. Ranjit Roy Chaudhury (6) Non-Executive - Independent 4 YesProf. V. N. Rajasekharan Pillai (7) Non-Executive - Independent 4 No

1. COMPANY'S PHILOSOPHY ON CORPORATEGOVERNANCE

The basic objective of corporate governance policiesadopted by the Company is to attain the highestlevels of transparency, accountability and integrity.This objective extends not merely to meet withstatutory requirements but also to go beyond themby putting into place procedures and systems,which are in accordance with best practices ofgovernance. Your Company believes that goodCorporate Governance enhances the trust andconfidence of all the stakeholders. Good practice incorporate behaviour helps to enhance and maintainpublic trust in companies and the stock markets.

Your Company reviews its corporate governancepractices to ensure that they reflect the latestdevelopments in the corporate arena and thusposition itself to conform to the best corporategovernance practices. Your Company is committedto pursue excellence in all its activities and maximizeits shareholders' wealth.

The Company's corporate governance policies andpractices focus on the following principles:

1. To recognize the respective roles andresponsibilities of the Board and Management.

2. To achieve the highest degree of transparency

by maintaining a high degree of disclosure levels.

3. To ensure and maintain high ethical standardsin its functioning.

4. To give the highest importance to investorrelations.

5. To ensure a sound system of risk managementand internal controls.

6. To ensure that employees of the Companysubscribe to the corporate values and applythem in their conduct.

7. To ensure that the decision making process isfair and transparent

2. BOARD OF DIRECTORS

(a) Composition of Board

As on 31st March, 2010, the Board of Directorsconsists of 14 (fourteen) members comprising of 1(one) Executive Director and 13 (thirteen) Non-Executive Directors including 7 (seven) IndependentDirectors. The Chairman of the Board is Non-Executive.

The Chairman, Vice-Chairman and ManagingDirector of the Company are not liable to retire byrotation. All other Directors are liable to retire byrotation.

3 Apolo-8-30.p65 8/5/2010, 12:54 PM21

22


(d) Number of Board Meetings held and thedates of the Board Meeting

Five (5) Board meetings were held during thefinancial year ended 31st March, 2010. The datesof the meetings are as follows : 30th April, 2009,28th July, 2009, 21st October, 2009, 23rd January,2010 and 10th March, 2010. The time gap betweentwo consecutive Board meetings was not more thanfour months.

(e) Board Procedure

The Board of the Company is provided with detailednotes along with the agenda papers in advance inrespect of various items discussed in the Boardmeetings including :-

(c) Number of Other Boards or Board Committees in which the Director is a Member / Chairman

None of the Directors on the Board is a Member of more than ten Committees or Chairman of more than fiveCommittees across all the companies in which he / she is a Director. Necessary disclosures regardingCommittee positions in other companies as on 31st March, 2010, have been made by the Directors.

The number of Directorships and Committee Chairmanships / Memberships held by them in other companiesare given below. Other directorships do not include alternate directorships, directorships of private limitedcompanies, section 25 companies and of companies incorporated outside India. Chairmanships /Memberships of Board Committees include only Audit and Shareholders / Investors Grievance Committees.

Name of the Director Number of Directorships in Number of Committee positionsother public companies held in other public companies

Chairman Member Chairman MemberMr. Rakesh Mehta (Chairman) 2 1 Nil NilDr. Prathap C Reddy (Vice-Chairman) 12 1 Nil NilMr. Jaideep Gupta (Managing Director) Nil Nil Nil NilMr. J. P. Singh Nil 10 Nil NilLt. Gen. (R) Vijay Lall Nil Nil Nil NilDr. B.Venkataraman Nil 2 Nil 1Ms. Suneeta Reddy 3 10 1 2Ms. Renu S. Karnad 1 11 2 3Mr. V.R. Reddy Nil Nil Nil NilMr. Satnam Arora Nil 3 Nil NilMr. Anil Kamineni Nil 1 Nil NilMr. S. Regunathan Nil Nil Nil NilProf. V. N. Rajasekharan Pillai Nil Nil Nil NilProf. Ranjit Roy Chaudhury Nil Nil Nil Nil

(1) Appointed by the Board as an Additional Director on 30.04.2009 and thereafter appointed by the shareholders as a Director atthe last Annual General Meeting held on 09.09.2009.

(2) Ceased to be a Director w.e.f. 11.11.2009.(3) Appointed by the Board as an Additional Director on 30.04.2009 and thereafter appointed by the shareholders as a Director at

the last Annual General Meeting held on 09.09.2009.(4) Appointed by the Board as an Additional Director on 22.10.2008 and thereafter appointed by the shareholders as a Director at




the last Annual General Meeting held on 09.09.2009.

• Annual Operating Plans and budgets and anyupdates.

• Capital expenditure and updates.

• Quarterly financial results / Annual financialstatements.

• Minutes of meetings of audit committee andother committees of the Board.

• Appointment of senior executives just below theBoard level.

• Show cause, demand, prosecution noticesand penalty notices, which are materiallyimportant.

3 Apolo-8-30.p65 8/5/2010, 12:54 PM22

23

• Fatal or serious accidents, dangerousoccurrences, material effluent or pollutionproblems.

• Significant development in Human Resources/ Industrial Relations.

• Report on legal matters.

• Quarterly statutory compliance report.

• Statement of transactions with related parties.

• Certificate by the Managing Director / CEO andVice President (Finance) regarding financialstatements in compliance with Clause 49V ofthe Listing Agreement.

(f) Code of Conduct

The Company's Board has laid down a Code ofConduct for all the Board Members and SeniorManagement Personnel of the Company. TheCode of Conduct has been placed on the websiteof the Company. All the Board Members andSenior Management Personnel of the Companyhave affirmed compliance with the Code ofConduct, during the financial year ended31st March, 2010.

3. AUDIT COMMITTEE

(a) Terms of Reference

The terms of reference of the Audit Committeecovers the areas mentioned under Clause 49 of theListing Agreement and Section 292A of theCompanies Act, 1956, besides other terms as maybe referred by the Board of Directors.

(b) Composition, Name of Members andChairman

The Audit Committee consists of three Non-Executive Directors (including two IndependentDirectors) viz. Dr. B Venkataraman, Lt. Gen. (R) VijayLall and Ms. Suneeta Reddy. Dr. B. Venkataraman(Independent Director) is the Chairman of the AuditCommittee.

Mr. Ajay Kumar Singhal, Vice President cumCompany Secretary is the Secretary to the AuditCommittee.

(c) Meetings and attendance during the year

The Audit Committee met four times during the yearand the time gap between two consecutivemeetings was not more than four months. The nameof Members, Chairman and their attendance at theAudit Committee Meetings are as under:

Members Category Meetings MeetingsHeld Attended

Dr. B Venkataraman Non - Executive - 4 4(Chairman) IndependentLt. Gen. (R)Vijay Lall Non - Executive - 4 4

IndependentMs. Suneeta Reddy Non - Executive 4 3

Mr. V. V. Bhat, Director of the Company, alsoattended three meetings of the Audit Committeeby invitation.

The Managing Director, Vice President cumCompany Secretary, Vice President (Finance) andrepresentatives of Statutory Auditors & InternalAuditors, also attend the Audit Committee meetings.

The Chairman of the Audit Committee was presentat the last Annual General Meeting of the Company.

4. REMUNERATION COMMITTEE

(a) Terms of Reference

The terms of reference of the RemunerationCommittee is to determine the Company's policyon specific remuneration packages for executivedirectors and other senior executives of theCompany including pension rights, anycompensation payment and such other relevantmatters as may be referred by the Board from timeto time.

(b) Composition, name of members andChairman

The Remuneration Committee consists of 5 Non-Executive Directors (including three IndependentDirectors) viz. Dr. B Venkataraman, Mr. V. V. Bhat.,Lt. Gen. (R) Vijay Lall, Ms. Suneeta Reddy andMr. V. R. Reddy. Dr. B Venkataraman (IndependentDirector) is the Chairman of the RemunerationCommittee.

(c) Attendance during the year

One meeting of the Remuneration Committee washeld during the financial year ended 31st March,2010, and all the members were present at themeeting.

The Chairman of the Remuneration CommitteeDr. B. Venkataraman was present at the last AnnualGeneral Meeting of the Company.

(d) Remuneration Policy

The remuneration policy is to remain competitive inthe industry and to attract and retain talent andappropriately reward employees on theircontribution.

3 Apolo-8-30.p65 8/5/2010, 12:54 PM23

24


(e) Details of Directors Remuneration

The details of Remuneration paid to Directors forthe year ended 31st March, 2010 are as under:-

i) The Non-Executive Directors are paid by wayof sitting fee for attending each meeting of theBoard of Directors or Committees thereof. Thedetails of Remuneration paid to Non-ExecutiveDirectors are as under:-

Name of the Director Sitting Fee (Rs.)

Mr. Rakesh Mehta 1,00,000Dr. Prathap C Reddy 80,000Mr. V. V. Bhat 1,20,000Mr. J. P. Singh 60,000Dr. B Venkataraman 2,20,000Lt. Gen. (R)Vijay Lall 2,60,000Ms. Suneeta Reddy 1,20,000Ms. Renu S Karnad 40,000Mr. V. R. Reddy 40,000Mr. Satnam Arora 1,00,000Mr. Anil Kamineni 80,000Mr. S. Regunathan 1,20,000Prof. V. N. Rajasekharan Pillai 80,000Prof. Ranjit Roy Chaudhury 80,000

Further, the shareholders and the Ministry ofCorporate Affairs, Govt. of India have approved forpayment of commission to the Non-ExecutiveDirectors including Independent Directors within theoverall maximum ceiling of 1% (one percent) of netprofits of the Company for a period of 3 years w.e.f.1st April, 2009, in addition to the sitting fees beingpaid for attending each meeting of the Board ofDirectors or Committees thereof.

The Board approved the payment of commissionof Rs. 2,50,000/- to each of the Non-ExecutiveDirector for the year ended 31st March, 2010 exceptthe Non-Executive Directors who were/are on theBoard for part of the year and being paidcommission proportionately. The aggregatecommission payable to all Non-Executive Directorsis well within the limit of 1% of net profits of theCompany calculated in accordance with theprovisions of the Companies Act, 1956.

Apart from receiving director's remuneration by wayof sitting fee for attending each meeting of the Boardor Committee thereof and commission, none of theNon-Executive Directors has any pecuniary

relationship or transactions with the Companyduring the year ended 31st March, 2010.

(ii) The details of Remuneration paid to ExecutiveDirector are as under:-

Name of the Salary Perquisite TotalDirector (Rs.)

Mr. Jaideep 48,52,400 5,82,412 54,34,812Gupta

5. SHAREHOLDERS/INVESTORS' GRIEVANCECOMMITTEE

The Company has a Shareholders / Investors'Grievance Committee of directors to look into theredressal of complaints of investors. TheShareholders / Investors' Grievance Committeeconsists of three Non-Executive - IndependentDirectors viz. Lt. Gen. (R) Vijay Lall, Dr. BVenkataraman and Mr. Satnam Arora. Lt. Gen. (R)Vijay Lall is the Chairman of the Shareholders /Investors' Grievance Committee. The Shareholders/ Investors' Grievance Committee met twice duringthe year.

a) Name of the Lt. Gen. (R) Vijay LallNon-ExecutiveDirector headingthe Committee

b) Name and Mr. Ajay Kumar SinghalDesignation of the Vice President cumCompliance Officer Company Secretary

c) Number of The Company hasShareholders received one hundredComplaints eight complaints during

the year and fourcomplaints werepending at thebeginning of the year.

d) Numbers not All the complaints haveresolved to the been resolved to thesatisfaction of satisfaction of theshareholders complainants, during

the year.

e) Number of pending Nonecomplaints ason 31st March, 2010

3 Apolo-8-30.p65 8/5/2010, 12:54 PM24

25

6. GENERAL BODY MEETINGS

(a) The last three Annual General Meetings wereheld as under :-

Financial Year Location Date Time

2008-2009 FICCI, Golden 9th September, 11.00 A.M.Jubilee Auditorium, 2009

2007-2008 Federation House, 10th September, 11.00 A.M.Tansen Marg, 2008

2006-2007 New Delhi - 110001 21st September, 10.15 A.M2007

Note:-

1) Special Resolution was passed at all threeAGM's mentioned above for the appointmentof Auditors, as more than 25% of the sharecapital of the Company is held by the Govt. ofDelhi.

2) Special Resolution was passed at AGM on21st September, 2007, in pursuance of Section198, 269 & 309 of the Companies Act, 1956 forthe appointment of and remuneration to Mr.Richard Leroy Larison as "Managing Director"of the Company.

3) Special Resolution was passed at AGM on21st September, 2007, in pursuance of Section

310 of the Companies Act, 1956 for increase inthe remuneration payable to Mr. Richard LeroyLarison, Managing Director of the Company.

4) Special Resolution was passed at AGM on9th September, 2009, in pursuance of Section198, 269 & 309 of the Companies Act, 1956 forthe appointment of and remuneration toMr. Jaideep Gupta as Managing Director of theCompany.

5) Special Resolution was passed at AGM on9th September, 2009, in pursuance of Section31 of the Companies Act, 1956, for alterationof the Articles of Association of the Company.

6) Special Resolution was passed at AGM on9th September, 2009, in pursuance of Section309(4) of the Companies Act, 1956, forapproval of the shareholders for payment ofcommission to the Non-Executive Directors ofthe Company.

7) No Resolution was required to be put throughpostal ballot last year.

8) No Special Resolution is proposed to beconducted through postal ballot.

7. DISCLOSURES

1) During the financial year ended 31st March, 2010, the following were the related party transactionsof material nature:-

Rs. in Lakhs

Name Relationship Nature of 31st March, 31st March,Transactions 2010 2009

Apollo Hospitals Associate Pharmacy-Consumables 1615.29 1374.61Enterprise Limited Licence Fees 90.03 78.00

Commission onPharmacy Sales 308.65 275.46Reimbursement of Expenses 82.80 32.49Account Payable 442.62 11.23

Managing Director Key Management Remuneration to Managing Director 54.35 61.34Personnel

2) There were no instances of non-compliance by the Company, penalties, strictures imposed on theCompany by the Stock Exchange or SEBI or any statutory authority on any matter related to capitalmarkets during the last three years.

3) The Company has not adopted a Whistle Blower Policy.

4) The Company has complied with all the Mandatory requirements of the Clause 49 of the ListingAgreement with Stock Exchanges on Corporate Governance. As regards the Non-mandatoryrequirements the extent of compliance has been stated in this report against each item.

5) A qualified practising Company Secretary carried out Secretarial Audit to reconcile the total admittedcapital with National Securities Depository Limited (NSDL) and the Central Depository Services(India) Limited (CDSL) and the total issued and listed capital. The secretarial audit report confirmsthat the total issued / paid-up capital is in agreement with the total number of shares in physicalform and the total number of dematerialized shares held with NSDL and CDSL.

3 Apolo-8-30.p65 8/5/2010, 12:54 PM25

26


8. MEANS OF COMMUNICATION

(i) Quarterly Results Published in the newspapers in terms of Clause 49of the Listing Agreement.

(ii) Newspapers wherein results Financial Express - All editions & Jansattanormally published (Hindi) - Delhi edition

(iii) Any website, where displayed Yes - www.apollohospdelhi.com

(iv) Whether it also displays Yesofficial news releases

(v) The presentations made to institutional Noinvestors or to the analysts

9. GENERAL SHAREHOLDER INFORMATION

a. Annual General Meeting 10th September, 2010 at 12.15 P.M.Date and Time and Venue FICCI, Golden Jubilee Auditorium,

Federation House, Tansen Marg,New Delhi - 110001.

b. Financial Calendar 1st Qtr. - 1st April to 30th June2nd Qtr. - 1st July to 30th September3rd Qtr. - 1st October to 31st December4th Qtr. - 1st January to 31st March

c. Book Closure Date Wednesday, 1st September, 2010 toFriday, 10th September, 2010.(both days inclusive).

d. Dividend Payment Date On or after 14th September, 2010

e. Listing on Stock Exchanges 1) The Bombay Stock Exchange Limited (BSE) &2) TheNational Stock Exchange of India (NSE)The annual listing fee for the year 2009-10 has been paid.

f. Stock Code / Symbol BSE - 532150NSE - INDRAMEDCO

Demat ISIN in NSDL & CDSL INE681B01017

g. Market Price Data Monthly High & Low during each month of the financial year2009-10 at National Stock Exchange (NSE) and Bombay StockExchange (BSE) are as under:-

Month National Stock Exchange Bombay Stock ExchangeHighest Lowest Volume Highest Lowest Volume

(Rs.) (Rs.) (Rs.) (Rs.) (Rs.) (Nos.)

Apr., 2009 33.50 27.70 11,67,699 33.75 27.50 14,09,362May., 2009 39.90 29.10 47,02,582 40.00 29.25 20,36,824June, 2009 43.80 33.50 33,07,415 43.80 33.50 16,76,203July, 2009 38.40 31.80 19,36,683 38.25 31.90 7,43,842Aug., 2009 42.50 35.05 50,48,307 42.80 35.15 23,18,996Sep., 2009 41.40 35.55 30,40,330 41.50 35.85 19,37,186Oct., 2009 40.45 35.00 30,53,478 40.70 33.80 21,00,030Nov., 2009 42.35 33.55 38,81,306 40.80 33.30 25,12,137Dec., 2009 45.90 32.80 55,16,359 46.00 38.25 38,56,572Jan., 2010 53.55 41.15 1,15,46,720 53.50 41.25 88,54,050Feb., 2010 45.75 36.60 18,04,914 45.50 40.10 9,70,616March, 2010 49.40 39.60 39,85,486 49.45 41.50 51,18,712

3 Apolo-8-30.p65 8/5/2010, 12:54 PM26

27

PerPerPerPerPerforforforforformance of the sharmance of the sharmance of the sharmance of the sharmance of the share price of the Company in comparison to BSE Sensexe price of the Company in comparison to BSE Sensexe price of the Company in comparison to BSE Sensexe price of the Company in comparison to BSE Sensexe price of the Company in comparison to BSE Sensex

h. Registrar and Transfer Agents M/s. Link Intime India Pvt. Ltd. continue to be the Registrar &Transfer Agents of the Company and their address is as under:-

M/s. Link Intime India Pvt. Ltd. A-40, 2nd Floor, Near BatraBanquet Hall, Naraina Ind. Area, Phase-II, New Delhi-110 028.

i. Share Transfer System The Company's shares are traded in the Stock Exchangescompulsorily in demat mode. Physical Shares which are lodgedwith the Registrar and Transfer Agents / or with the Companyfor transfer are processed and returned to the shareholdersduly transferred within the time limit stipulated under the ListingAgreement subject to the documents being in order.

j. Distribution of shareholding as on 31st March, 2010

Shareholding of Shareholders Share Amountnominal value ofRs. Rs. Number % to total Rs. % to totalUpto 2,500 21,143 59.985 2,49,80,900 2.7252,501 - 5,000 7,011 19.891 3,01,83,310 3.2925,001 - 10,000 3,551 10.075 3,15,00,800 3.43610,001 - 20,000 1,542 4.375 2,48,33,540 2.70920,001 - 30,000 562 1.594 1,46,39,850 1.59730,001 - 40,000 270 0.766 99,70,030 1.08840,001 - 50,000 276 0.783 1,33,54,200 1.45750,001 - 1,00,000 427 1.211 3,23,48,110 3.5291,00,001 & above 465 1.319 73,49,19,260 80.167Total 35,247 100.000 91,67,30,000 100.000

3 Apolo-8-30.p65 8/5/2010, 12:54 PM27

28


Shareholding Category as on 31st March, 2010

Category No. of Shares held % to total

Indian Promoters 4,47,40,294 48.80Foreign Promoters 19,56,644 2.13Mutual Funds & UTI 8,12,348 0.89Financial Institutions / Banks 5,01,467 0.55Foreign Institutional Investors 16,000 0.02Bodies Corporate 1,55,41,883 16.95NRI's/OCB's 22,35,689 2.44Indian public 2,58,68,675 28.22Grand Total 9,16,73,000 100.000

Shares held by Non-Executive Directors

The number of shares held by Non-Executive Directors as on 31st March, 2010, is as under:-

Name of the Non-Executive Director Number of shares heldDr. Prathap C Reddy 2,37,187Dr. B Venkataraman 15,800Ms. Suneeta Reddy 1,38,293Prof. Ranjit Roy Chaudhury 1,000

k. Dematerialisation of shares

About 67% of the Company's paid-up equity share capital has been dematerialised up to31st March, 2010.

The details of demat of shares as on 31st March, 2010 are as under:-

No. of Shareholders No. of Shares % of capital

NSDL 20,492 5,60,23,224 61.11CDSL 6,783 55,22,686 6.02

Requests for dematerialisation of shares are processed and confirmation is given to the respectivedepositories i.e. National Securities Depository Limited (NSDL) and Central Depository ServicesIndia Limited (CDSL) within 15 days.

Shares of the Company are regularly traded at NSE & BSE.

l. Outstanding GDRs/ADRs/Warrants or any Convertible instruments, conversion date and likelyimpact on equity

The Company has not issued any GDRs/ADRs/Warrants or any other convertible instruments.

m. Hospital Location Indraprastha Apollo Hospitals,Sarita Vihar, Delhi-Mathura Road,New Delhi - 110076.

n. Address for Correspondence Postal Address :-M/s. Indraprastha Medical Corporation LimitedSarita Vihar, Delhi-Mathura Road,New Delhi - 110076E-mail Address for Investors:[email protected]

3 Apolo-8-30.p65 8/5/2010, 12:54 PM28

29

NON-MANDATORY REQUIREMENTS

1 (a) Whether Chairman of the Board is entitledto maintain a Chairman's office at theCompany's expense and also allowedreimbursement of expenses incurred inperformance of his duties.

(b) Independent Directors may have a time notexceeding in the aggregate a period of nineyears on the Board of the Company

2. Remuneration Committee

3. Shareholder rights - the half yearly declarationof financial performance including summary ofthe significant events in last six months shouldbe sent to each household of shareholders

4. Audit Qualifications

5. Training of Board Members

6. Mechanism for evaluating non-executive Boardmembers

7. Whistle Blower Policy

No office for the Chairman is maintained at theCompany's expense. There was no reimbursementof expenses to the Chairman.

As on date, there is no Independent Director havinga term of office exceeding nine years on the Boardof the Company except Dr. B. Venkataraman whowas appointed on the Board of the Company on22-9-1995 and has completed the term of 14 years.

Please refer to Sr. No. 4 of this report

As the Company's half yearly results are publishedin English newspaper having a circulation all overIndia and in a Hindi newspaper having a circulationin Delhi region, the same are not sent to theshareholders of the Company.

There are no audit qualifications in the Auditorsreport.

At present, the Company does not have such atraining programme for the Board members.

At present, the Company does not have such amechanism as contemplated for evaluating theperformance of non-executive Board members.

At present, the Company does not have a WhistleBlower Policy.



3 Apolo-8-30.p65 8/5/2010, 12:54 PM29

30


C E R T I F I C A T E

ToThe Members of Indraprastha Medical Corporation Ltd.

We have examined the compliance of conditions of corporate governance by M/s IndraprasthaMedical Corporation Ltd., for the year ended on 31.03.2010, as stipulated in clause 49 of theListing Agreement of the said company with stock exchange(s).

The compliance of conditions of corporate governance is the responsibility of the management.Our examination was limited to procedures and implementation thereof, adopted by the companyfor ensuring the compliance of the conditions of the Corporate Governance. It is neither an auditnor an expression of opinion on the financial statements of the company.

In our opinion and to the best of our information and according to the explanations given to us, wecertify that the company has complied with the conditions of Corporate Governance as stipulatedin the above mentioned Listing Agreement.

We state that no investor grievance(s) are pending against the company as per the recordsmaintained by the company as on 31st March, 2010

We further state that such compliance is neither an assurance as to the future viability of thecompany nor the efficiency or effectiveness with which the management has conducted the affairsof the company.

For S.C. Vasudeva & Co.,Chartered Accountants

Firm Reg. No. 000235N

Place : New Delhi Sanjay Vasudeva

Date : 28th July, 2010 Partner

M.No. 90989

Declaration under Clause 49-I (D) of the Listing Agreement

ToThe Members of Indraprastha Medical Corporation Ltd.

I hereby declare that all Board Members and Senior Management Personnel of the Companyhave affirmed compliance with the provisions of the CODE OF CONDUCT during the financialyear ended 31st March, 2010.

Name : Jaideep Gupta

Designation : Managing Director

Date : 18th July, 2010

3 Apolo-8-30.p65 8/5/2010, 12:54 PM30

31

To the Members of

Indraprastha Medical Corporation Limited.edical Corporation Limited.edical Corporation Limited.edical Corporation Limited.edical Corporation Limited.

We have audited the attached Balance Sheet ofIndraprastha Medical Corporation Limited, as at31st March, 2010 and also the Profit and Loss Accountfor the year ended on that date annexed thereto and theCash Flow Statement for the year ended on that date.These financial statements are the responsibility of theCompany's Management. Our responsibility is to expressan opinion on these financial statements based on ouraudit.

We conducted our audit in accordance with auditingstandards generally accepted in India. Those standardsrequire that we plan and perform the audit to obtainreasonable assurance about whether the financialstatements are free of material misstatement. An auditincludes an examination, on a test basis, of the evidencesupporting the amounts and disclosures in the financialstatements. An audit also includes assessing theaccounting principles used and significant estimatesmade by the management, as well as evaluating theoverall financial statement presentation. We believe thatour audit provides a reasonable basis for our opinion.

As required by the Companies (Auditor's Report) Order,2003 as amended by the Companies (Auditor's Report)(Amendment) Order, 2004 issued by the CentralGovernment of India in terms of sub-section (4A) ofSection 227 of the Companies Act, 1956, we enclose inthe Annexure a statement on the matters specified inparagraph 4 & 5 of the said order.

Further to our comments in the annexure referred toabove, we report that:

a) We have obtained all the information andexplanations, which to the best of our knowledgeand belief were necessary for the purpose of ouraudit;

b) In our opinion, proper books of account, as requiredby law have been kept by the company so far, asappears from our examination of the books;

c) In our opinion, the Balance Sheet, Profit and LossAccount and Cash Flow Statement are in agreementwith the books of account;

d) The Balance Sheet, Profit and Loss Account andCash Flow Statement comply with the accountingstandards referred to in sub-section (3C) of section211 of the Companies Act, 1956;

AUDITORS’ REPORTe) On the basis of the written representations received

from the directors/companies in which they aredirectors as on 31st March 2010, and taken on recordby the Board of Directors, we report that none of thedirectors is disqualified as on 31st March, 2010 frombeing appointed as a director in terms of clause (g)of sub-section (1) of Section 274 of the CompaniesAct, 1956;

f) The provisions of Section 441 A of the CompaniesAct, 1956 regarding the levy and collection of cesson turnover or gross receipts of the companies, havenot yet been notified by the Central Government.Accordingly, we do not express our opinion on thecompliance of the said Section in terms of clause(g) of sub-section (3) of section 227.

g) In our opinion and to the best of our information andaccording to explanations given to us, the saidaccounts read with the notes thereon give theinformation required by the Companies Act, 1956,in the manner so required and give a true and fairview in conformity with the accounting principlesgenerally accepted in India.

i.) In the case of the Balance Sheet, of the state ofaffairs of the company as at 31st March, 2010;

ii.) In the case of the Profit and Loss Account, ofthe profit for the year ended on that date; and

iii.) In the case of Cash Flow Statement, of the cashflows for the year ended on that date.

For S.C.Vasudeva & Co.Chartered AccountantsFirm Reg. No. 000235NSanjay Vasudeva

Place: New Delhi PartnerDated: 27th April, 2010 M.No. 90989

ANNEXURE TO THE AUDITORS' REPORT

Annexure referred in paragraph 3 of our report to themembers of Indraprastha Medical Corporation Limitedon accounts for the financial year ended 31st March 2010.

(i) (a) According to the information and explanationsgiven to us and on the basis of the books andrecords examined by us in the normal course ofaudit and to the best of our knowledge and belief,we state that the company has maintained properrecords showing full particulars includingquantitative details and situation of fixed assets.

4 Appolo-31-48.p65 8/5/2010, 12:54 PM31

32


(b) According to the information and explanationsgiven to us, the fixed assets have beenphysically verified by the management duringthe year and we are informed that nodiscrepancies were noticed on such physicalverification. In our opinion, the frequency ofphysical verification of fixed assets isreasonable having regard to the size of thecompany and the nature of its business.

(c) According to the information and explanationsgiven to us, the company has not disposed offsubstantial part of its fixed assets during theyear.

(ii) (a) According to the information and explanationsgiven to us, the physical verification of inventoryhas been conducted at reasonable intervalsduring the year by the management. In ouropinion the frequency of verification isreasonable.

(b) In our opinion and according to the informationand explanations given to us, the proceduresof physical verification of inventory followed bythe management as evidenced by writtenprocedures and instructions are reasonable andadequate in relation to the size of the companyand the nature of its business.

(c) In our opinion and according to the informationand explanations given to us, the company hasmaintained proper records of its inventories.Further according to the information andexplanations given to us no materialdiscrepancies were noticed on physicalverification of inventory as compared to the bookrecords. The balance of inventory establishedon physical verification as at the year end havebeen incorporated in the books of account.Consequently, the shortages/excess, if anyhave been adjusted in the consumption of storesand spares.

(iii) (a) According to the information and explanationsgiven to us, the Company has not granted anyloans, secured or unsecured to any companies,firms or parties covered in the registermaintained under Section 301 of the CompaniesAct, 1956.

(b) As the Company has not granted any loans,secured or unsecured to companies, firms orother parties covered in the register maintained

under section 301 of the Companies Act, 1956,the provisions of Paragraph 4 (iii) (b), (iii) (c)and (iii) (d) of the Order are not applicable tothe company.

(c) According to the information and explanationsgiven to us, the Company has not taken anyloans, secured or unsecured from anycompanies, firms or parties covered in theregister maintained under Section 301 of theCompanies Act, 1956.

(d) As the Company has not taken any loans,secured or unsecured from companies, firmsor other parties covered in the registermaintained under section 301 of the CompaniesAct, 1956, the provisions of Paragraph 4 (iii) (f)and (iii) (g) of the Order are not applicable tothe company.

(iv) In our opinion and according to the information andexplanations given to us, there is an adequateinternal control system commensurate with the sizeof the company and the nature of its business forpurchase of inventory and fixed assets and for thesale of goods and services. During the course ofour audit, we have not observed any continuingfailure to correct major weaknesses in internal controlsystem.

(v) (a) According to the information and explanationsgiven to us, we are of the opinion that thecontracts or arrangements referred to in section301 of the Companies Act, 1956, have beenentered in the register required to be maintainedunder that section.

(b) In our opinion and according to the informationand explanations given to us, each of thetransactions made in pursuance of the contractsor arrangements entered in the registermaintained under section 301 of the CompaniesAct, 1956 and exceeding the aggregate valueof rupees five lakhs during the financial yearunder audit in respect of each party have beenmade at prices which are reasonable havingregard to the prevailing market prices at therelevant time.

(vi) According to the information and explanations givento us the company has not accepted any depositsfrom the public. Therefore, the provisions of Section58A, 58AA or any other relevant provisions of theCompanies Act, 1956 and relevant rules framedthereunder are not applicable to the company.

4 Appolo-31-48.p65 8/5/2010, 12:54 PM32

33

(vii) In our opinion, the company has an internal auditsystem commensurate with its size and nature of itsbusiness.

(viii) According to the information and explanationsgiven to us, the Central Government has notprescribed the maintenance of cost records underSection 209 (1) (d) of the Companies Act, 1956.

(ix) (a) According to the information and explanationsgiven to us and the books and records examinedby us in the normal course of audit and to thebest of our knowledge and belief, we state thatundisputed statutory dues including ProvidentFund, Investor Education and Protection Fund,Income-tax, Sales Tax, Customs Duty, WealthTax, Service Tax, Cess and other materialstatutory dues applicable to the company, ifany, have been regularly deposited with theappropriate authorities during the financial year.We are informed that the provisions of ExciseDuty are not applicable to the company.

(b) According to the information and explanationsgiven to us, there are no dues of Sales tax,Income-tax, Customs Duty, Wealth tax, Servicetax and Cess which have not been depositedon account of any dispute.

(x) In our opinion, the company does not haveaccumulated losses and has not incurred cashlosses during the financial year covered by our auditand the immediately preceding financial year.

(xi) Based on our audit procedures and the informationand explanations given by the management we areof the opinion that the company has not defaulted inrepayment of dues to any financial institution or bank.As informed to us no money has been raised throughdebentures by the company.

(xii) According to the information and explanations givento us, the company has not granted any loans and/ or advances on the basis of security by way ofpledge of shares, debentures and other securities.Therefore, the provisions of paragraph 4(xii) of theOrder are not applicable to the company.

(xiii) The company is not a chit fund company or nidhi /mutual benefit fund/society. Therefore, theprovisions of Paragraph 4 (xiii) of the said Order arenot applicable to the company.

(xiv) The Company is not dealing or trading in shares,securities, debentures and other investments.Therefore the provisions of paragraph 4(xiv) of thesaid Order are not applicable to the company.

(xv) According to the information and explanations givento us, the company has not given any guarantee forloans taken by others from banks or financialinstitutions. Accordingly, the provisions of paragraph4(xv) of the said Order are not applicable to thecompany.

(xvi) According to the information and explanations givento us and on the basis of the books and recordsexamined by us in the normal course of audit and tothe best of our knowledge and belief, we report thatthe term loans raised have been utilised for thepurpose for which the loans were obtained.

(xvii) According to the information and explanations givento us and on an overall examination of the BalanceSheet of the company, we report that no funds raisedon short-term basis have been used for long-terminvestments by the company.

(xviii) According to the information and explanations givento us the company has not made any preferentialallotment of shares to parties and companiescovered in the register maintained under section301 of the Act.

(xix) According to the information and explanations givento us, the company has not issued any debentures.Therefore the provisions of paragraph 4 (xix) of thesaid Order are not applicable to the company.

(xx) According to the information and explanations givento us, the company has not raised any money bypublic issue during the year. Therefore, theprovisions of paragraph 4 (xx) of the said Order arenot applicable to the company.

(xxi) According to the information and explanations givento us, no fraud, on or by the company has beennoticed or reported during the year.

For S.C.Vasudeva & Co.Chartered AccountantsFirm Reg. No. 000235NSanjay Vasudeva

Place: New Delhi PartnerDated: 27th April, 2010 M.No. 90989

4 Appolo-31-48.p65 8/5/2010, 12:54 PM33

34


BALANCE SHEET AS AT 31ST MARCH, 2010As at As at

Schedule 31st March, 2010 31st March, 2009Particulars No. Rs. Rs.

SOURCES OF FUNDSShareholders’ FundsShare Capital 1 916,730,000 916,730,000Reserves and Surplus 2 440,273,107 301,276,942

Loan FundsSecured Loans 3 292,885,629 492,700,655

Deferred Tax Liability (Net) 282,010,083 307,853,644

Total 1,931,898,819 2,018,561,241

APPLICATION OF FUNDSFixed Assets 4Gross Block 3,748,215,627 3,478,297,641

Less: Depreciation 1,689,535,851 1,525,068,993

Net Block 2,058,679,776 1,953,228,648Capital Work in Progress 36,714,227 60,308,681

Current Assets, 5Loans and AdvancesInventories 95,964,771 90,834,761Sundry Debtors 282,805,155 285,700,756Cash and Bank Balances 43,840,760 31,204,429Other Current Assets 144,813,441 163,940,795Loans and Advances 339,148,744 247,299,760

906,572,871 818,980,501Less:Current liabilities 6

and ProvisionsLiabilities 701,746,143 506,024,877Provisions 368,321,912 307,931,712

1,070,068,055 813,956,589

Net Current Assets (163,495,184) 5,023,912

Total 1,931,898,819 2,018,561,241

Notes to Accounts 10

As per our separate report of even date attachedFor S.C. Vasudeva & Co.Chartered Accountants

Ajay Kumar Singhal Rakesh Mehta ChairmanSanjay Vasudeva Vice President Cum Dr. Prathap C. Reddy Vice ChairmanPartner Company Secretary Jaideep Gupta Managing DirectorM. No. 90989 Suneeta Reddy DirectorFirm Reg. No. 000235N

Place : New DelhiDate : 27th April, 2010

4 Appolo-31-48.p65 8/5/2010, 12:54 PM34

35

PROFIT & LOSS ACCOUNT FOR THE YEAR ENDED 31ST MARCH, 2010For the year For the year

ended endedSchedule 31st March, 2010 31st March, 2009

Particulars No. Rs. Rs.

INCOMEHospital Revenue 4,244,268,391 3,911,852,537Other Income 7 120,530,005 146,980,778

Total 4,364,798,396 4,058,833,315

EXPENDITUREStores and Spares consumed 1,148,712,165 1,166,949,459Operating and Administrative Expenses 8 2,519,112,328 2,275,198,656Interest and other Financial Charges 9 38,542,427 57,474,859Depreciation 192,904,223 186,678,362

Total 3,899,271,143 3,686,301,336

Profit before tax 465,527,253 372,531,979Less : Provision for - Current Tax 161,222,111 112,681,537

- Deferred Tax (9,248,569) 14,790,110- Fringe Benefit Tax - 6,289,718- Wealth Tax 90,560 103,572

Tax paid/excess provision for tax written back 2,862,464 (203,265)

Profit after tax 310,600,687 238,870,307

Balance available for appropriation 310,600,687 238,870,307AppropriationsTransferred to General Reserve 25,000,000 12,500,000Proposed Dividend 146,676,800 137,509,500Tax on Proposed Dividend 24,927,722 23,369,740

Surplus carried to Balance Sheet 113,996,165 65,491,067

Earnings per share of Rs. 10/- each(Refer to note no. 12 of Notes to Accounts)Basic & Diluted 3.39 2.61

Notes to Accounts 10




4 Appolo-31-48.p65 8/5/2010, 12:54 PM35

36


Particulars Year Ended Year Ended31st March, 2010 31st March, 2009

Rs. Rs.

A. CASH FLOW FROM OPERATING ACTIVITIESNet Profit before tax & Extraordinary items 465,527,253 372,531,979

Add:Depreciation 192,904,223 186,678,362Interest charged 28,722,556 47,332,290Loss on discarded assets 14,771,626 -

Deduct:Interest received 2,442,203 3,097,164Operating Profit before Working Capital changes 699,483,455 603,445,467

Adjustments forTrade & Other Receivables 45,854,442 (22,559,606)Trade payables 169,737,633 126,653,291Inventories (5,130,010) 4,485,999Cash Generated from Operations 909,945,520 712,025,151Deduct:Interest paid (1,325,338) (4,016,699)Income tax paid (178,555,945) (109,496,518)

Net Cash from Operating Activities 730,064,237 598,511,934

B. CASH FLOW FROM INVESTING ACTIVITIESPurchase of Assets (Net of sale) (362,730,956) (253,534,102)Interest received 2,095,434 2,864,248

Net Cash from Investing Activities (360,635,522) (250,669,854)

C. CASH FLOW FROM FINANCING ACTIVITIESProceeds from - short term loans - 100,000,000Repayment of - long term loans (169,313,159) (151,882,811)Repayment of - short term loans - (100,000,000)Interest paid (27,944,668) (43,851,183)Dividend paid (159,534,557) (148,502,042)

Net Cash from Financing Activities (356,792,384) (344,236,036)

Net increase in cash and Cash equivalents 12,636,331 3,606,044

Opening Cash and cash equivalents 31,204,429 27,598,385

Closing Cash and cash equivalents 43,840,760 31,204,429

CASH FLOW STATEMENT FOR THE YEAR ENDED 31ST MARCH, 2010




4 Appolo-31-48.p65 8/5/2010, 12:54 PM36

37

SCHEDULE 1 As at As at31st March, 31st March,

2010 2009SHARE CAPITAL Rs. Rs.Authorised100,000,000 Equity Shares of Rs. 10/- each 1,000,000,000 1,000,000,000

1,000,000,000 1,000,000,000

Issued, Subscribed and Paid up(91,673,000 equity shares of Rs. 10/- each fully paid up) 916,730,000 916,730,000

916,730,000 916,730,000

SCHEDULE 2

RESERVES AND SURPLUS

(a) General ReserveAs per last account 32,500,000 20,000,000Add : Transferred from Profit and Loss Account 25,000,000 12,500,000

57,500,000 32,500,000

(b) Profit and loss accountOpening balance 268,776,942 203,285,875Add : Surplus for the year 113,996,165 65,491,067

382,773,107 268,776,942

440,273,107 301,276,942

SCHEDULE 3

SECURED LOANSLoans from Banks:–Term loan 108,000,000 242,000,000

(The above are secured by exclusive charge on the medical equipment and othermovable fixed assets funded from the term loan and subservient charge on themovable fixed assets both present and future)From Institutions:-Term loan - -Other Loans and Advances:-Term loan 82,929,030 118,242,189(The above are secured by exclusive charge on the medicalequipment and other movable fixed assets funded from theterm loan)(Due for repayment within 12 months Rs. 147,266,533/-(Previous year Rs. 169,313,159/-))Working capital facility from Bank 101,956,599 132,458,466(Secured against hypothecation of stores,spares and receivables)

292,885,629 492,700,655

SCHEDULES

4 Appolo-31-48.p65 8/5/2010, 12:54 PM37

38


SC

HE

DU

LE

4

FIX

ED

AS

SE

TS

Gro

ss B

lock

Dep

reci

atio

n/A

mo

rtis

atio

nIm

pai

rmen

tN

et B

lock

Cos

t As

atA

dd

ition

sD

elet

ion/

Co

st A

s at

Up

toFo

r th

eW

ritte

n b

ack/

Up

to

Up

to

As

atA

s at

1.04

.200

9A

dju

sted

31.0

3.20

1031

.03.

2009

Yea

rA

dju

sted

31.0

3.20

1031

.03.

2010

31.0

3.20

1031

.03.

2009

Par

ticu

lars

(Rs.

)(R

s.)

(Rs.

)(R

s.)

(Rs.

)(R

s.)

(Rs.

)(R

s.)

(Rs.

)(R

s.)

(Rs.

)

(A)

Tan

gib

le A

sset

s

LE

AS

EH

OL

D L

AN

DN

ILN

ILN

ILN

IL

(LE

AS

ED

FR

OM

DE

LH

I A

DM

INIS

TR

AT

ION

)

BU

ILD

ING

S93

9,03

3,25

782

,869

,028

-1,

021,

902,

285

165,

734,

278

20,5

77,8

56-

186,

312,

134

-83

5,59

0,15

177

3,29

8,97

9

FUR

NIT

UR

E &

FIT

TIN

GS

127,

371,

511

12,3

11,5

30-

139,

683,

041

61,0

44,7

868,

680,

154

-69

,724

,940

-69

,958

,101

66,3

26,7

25

PLA

NT

& M

AC

HIN

ER

Y34

4,61

3,26

925

,044

,466

-36

9,65

7,73

513

8,27

4,40

517

,033

,029

-15

5,30

7,43

4-

214,

350,

301

206,

338,

864

OFF

ICE

EQ

UIP

ME

NT

219,

483,

655

47,4

98,3

025,

633,

431

261,

348,

526

128,

634,

041

20,3

88,3

794,

361,

435

144,

660,

985

-11

6,68

7,54

190

,849

,614

ME

DIC

AL

EQ

UIP

ME

NT

1,80

8,20

7,82

113

9,44

3,73

3*36

,997

,216

1,91

0,65

4,33

888

4,49

2,64

712

3,10

4,61

323

,551

,819

984,

045,

441

120,

796,

328

805,

812,

569

802,

918,

846

VE

HIC

LES

18,3

35,7

872,

443,

566

1,00

2,40

819

,776

,945

6,45

0,18

11,

794,

948

524,

111

7,72

1,01

8-

12,0

55,9

2711

,885

,606

TOTA

L (A

)3,

457,

045,

300

309,

610,

625

43,6

33,0

553,

723,

022,

870

1,38

4,63

0,33

819

1,57

8,97

928

,437

,365

1,54

7,77

1,95

212

0,79

6,32

82,

054,

454,

590

1,95

1,61

8,63

4

(B)

INTA

NG

IBLE

ASS

ETS

SO

FTW

AR

E21

,252

,341

3,94

0,41

6-

25,1

92,7

5719

,642

,327

1,32

5,24

4-

20,9

67,5

71-

4,22

5,18

61,

610,

014

TOTA

L (B

)21

,252

,341

3,94

0,41

6-

25,1

92,7

5719

,642

,327

1,32

5,24

4-

20,9

67,5

71-

4,22

5,18

61,

610,

014

GR

AN

D T

OTA

L (A

+B)

3,47

8,29

7,64

131

3,55

1,04

143

,633

,055

3,74

8,21

5,62

71,

404,

272,

665

192,

904,

223*

*28

,437

,365

1,56

8,73

9,52

312

0,79

6,32

82,

058,

679,

776

1,95

3,22

8,64

8

Pre

viou

s Y

ear

3,23

3,00

2,53

724

5,29

5,10

4N

il3,

478,

297,

641

1,21

7,59

4,30

318

6,67

8,36

2N

il1,

404,

272,

665

120,

796,

328

1,95

3,22

8,64

81,

894,

611,

906

Cap

ital W

ork

In P

rogr

ess

36,7

14,2

2760

,308

,681

* In

clud

es a

dditi

ons

durin

g th

e ye

ar a

mou

ntin

g to

Rs.

101,

880,

842/

-(P

revi

ous

Yea

r R

s.53

,651

,965

/-)

whi

ch h

ave

been

dep

reci

ated

@ 1

3.57

% b

ased

on

the

tech

nolo

gica

l eva

luat

ion

of t

he e

stim

ated

use

ful l

ife o

f se

ven

year

s.

** I

nclu

des

Rs.

1,32

5,24

4/-

(Pre

viou

s ye

ar 2

,003

,456

/-)

on a

ccou

nt o

f am

ortis

atio

n of

inta

ngib

le a

sset

s.

4 Appolo-31-48.p65 8/5/2010, 12:54 PM38

39

As at As at31st March, 31st March,

2010 2009SCHEDULE 5 Rs. Rs.

CURRENT ASSETS, LOANS AND ADVANCES

Inventories

Stores & Spares 39,317,284 31,559,915Crockery & Utensils 4,517,699 4,317,707Linen 8,203,871 11,482,761Medical & Surgical Instruments 43,925,917 43,474,378

95,964,771 90,834,761

Sundry Debtors (Unsecured)Debts outstanding for a period exceeding six months– Considered Good 69,459,923 81,971,561– Doubtful 14,263,821 13,252,757Other Debts– Considered Good 213,345,232 203,729,195

297,068,976 298,953,513Less : Provision for doubtful debts 14,263,821 13,252,757

282,805,155 285,700,756

Cash and Bank Balances– Cash balance on hand 8,744,434 9,181,562– With scheduled banks

in current accounts 18,750,754 7,750,415in fixed deposits 6,721,638 5,993,201

(includes Rs. 3,640,160/- pledged towards margin money)(previous year 2,915,160/-)– With scheduled banks in

Unpaid Dividend Account 9,623,934 8,279,251

43,840,760 31,204,429

Other Current AssetsPatient's treatment in progress 77,794,050 78,462,816Interest Receivable 951,647 604,878Other Receivable 66,067,744 84,873,101

144,813,441 163,940,795

Loans and Advances(Unsecured, considered good)Advance for capital items 91,591,184 16,281,144Advances recoverable in cash or in kind or for 24,235,944 22,247,596value to be receivedPrepaid Taxes 198,488,315 158,464,653Deposits 11,644,114 11,114,293Prepaid Expenses 13,189,187 39,192,074

339,148,744 247,299,760

4 Appolo-31-48.p65 8/5/2010, 12:54 PM39

40


As at As at31st March, 31st March,


CURRENT LIABILITIES AND PROVISIONS

a. Current LiabilitiesSundry Creditors -Due to Micro and Small Enterprises - -Due to Others-for Capital Works 18,037,620 15,926,013-for Expenses 247,230,227 149,784,498Advance from patients 117,398,860 131,149,448Unclaimed Dividend 9,623,934 8,279,251Other liabilities 308,008,814 198,891,529

Interest Accrued but not due 1,446,688 1,994,138

701,746,143 506,024,877

b. ProvisionsProvision for Income tax 161,222,111 112,681,537Provision for Fringe Benefit tax - 6,289,718Provision for Wealth tax 90,560 103,572Proposed Dividend 146,676,800 137,509,500Tax on Proposed Dividend 24,927,722 23,369,740Provision for Employee Benefits 35,404,719 27,977,645

368,321,912 307,931,712

For the year For the yearended 31st March, ended 31st March,


OTHER INCOME

Interest received from banks 2,257,600 2,247,669[Tax deducted at source Rs. 222,216/-(Previous Year Rs. 459,202/-)]Interest received from others 184,603 849,495License fee & commission from licensees 72,137,205 55,948,105Service charges received from doctors 16,602,764 16,346,388Miscellaneous income 23,454,875 67,524,117Provision no longer required written back 5,892,958 4,065,004

120,530,005 146,980,778

4 Appolo-31-48.p65 8/5/2010, 12:54 PM40

41

For the year For the yearended 31st March, ended 31st March,


OPERATING AND ADMINISTRATIVE EXPENSES

Salaries and wages 741,987,893 699,411,644Contribution to Provident & Other Funds 43,670,102 37,463,022Staff welfare 38,711,935 36,740,520Consultation fees paid to doctors 1,038,247,722 908,003,809Outside lab investigations 5,169,997 6,992,121Leasehold ground rent 12 12Power & Fuel 130,589,729 134,666,889Rent 17,318,631 19,313,558Travelling and Conveyance 38,069,832 36,617,926Insurance 6,498,431 5,587,586Directors’ sitting fees 1,500,000 920,000Communication 14,810,287 18,983,046Printing and stationery 28,578,990 27,327,881Advertisement 73,790,558 87,908,662Legal and professional charges 40,667,731 30,582,415Security charges 11,773,163 10,615,158Payment to auditors 899,270 884,270Auditors out of pocket expenses 45,642 30,992Rates, taxes and licenses 17,965,761 16,005,561Loss on Discarded Assets 14,771,626 -Service Charges 118,873,829 99,701,247Repairs and maintenance- Building 53,075,435 28,312,005- Plant & Machinery 35,732,007 32,329,749- Others 16,244,104 13,687,129Miscellaneous expenses 17,828,573 13,536,830Bad debts written off 5,387,046 3,683,666Provision for doubtful debts 6,904,022 5,892,958

2,519,112,328 2,275,198,656

SCHEDULE 9

INTEREST AND OTHER FINANCIAL CHARGES

Interest on term loans 27,397,218 43,315,591Interest on working capital 1,325,338 4,016,699Other financial charges 9,819,871 10,142,569

38,542,427 57,474,859

4 Appolo-31-48.p65 8/5/2010, 12:54 PM41

42


SCHEDULE 10

SIGNIFICANT ACCOUNTING POLICIES AND NOTES TO ACCOUNTS FORMING PART OF ACCOUNTS FOR THEYEAR ENDED 31st MARCH, 2010.

I. Significant Accounting Policies:

A. Accounting Convention

The accounts are prepared on accrual basis under the historical cost convention in accordance with theaccounting standards referred to in section 211 (3C) of the Companies Act, 1956 and other relevant provisionsof the said Act.

B. Revenue Recognition

i) Revenue is recognized on accrual basis. Hospital Revenue comprises of income from services renderedto the out-patients and in-patients. Revenue also includes value of services rendered pending billing inrespect of in-patients undergoing treatment as on 31st March, 2010.

ii) The revenue in respect of export benefits is recognized on the basis of the foreign exchange earnedduring the year at the rate at which the said entitlement accrues to the extent there is no significantuncertainty as to the amount of consideration that would be derived and as to its ultimate collection.

C. Fixed Assets

Fixed Assets are stated at historical cost less accumulated depreciation.

D. Depreciation

i) Depreciation is charged on straight line method at the rates prescribed under schedule XIV to the CompaniesAct, 1956 (considered the minimum rate) or at higher rates, if the estimated useful life based on technologicalevaluation of the assets are lower than as envisaged under Schedule XIV to the Companies Act. In case ofadditions and deletions during the year, the computations are on the basis of number of days for which theassets have been in use. Assets costing not more than Rs. 5,000/- each, individually have been depreciatedfully in the year of purchase.

ii) When impairment loss / reversal is recognized, the depreciation charge for the asset is adjusted in futureperiods to allocate the asset’s revised carrying amount, less its residual value (if any) on a systematicbasis over its remaining useful life.

E. Intangible Assets

Intangible Assets are stated at cost less accumulated amortisation.

F. Amortisation of Intangible Assets

i) Intangible assets are amortised on straight line method over the estimated useful life of the asset.

ii) The useful life of the intangible assets for the purpose of amortisation is estimated to be three years.

G. Impairment of Assets

Consideration is given at each balance sheet date to determine whether there is any indication of impairmentof the Company’s fixed assets. If any indication exists, an asset’s recoverable amount is estimated. An impairmentloss is recognised whenever the carrying amount of an asset exceeds its recoverable amount. The recoverableamount is determined on the basis of value in use. In assessing value in use, the estimated future cash flowsare discounted to their present value based on an appropriate discount factor.

Reversal of impairment losses recognised in prior years is recorded when there is an indication that theimpairment losses recognised for the asset no longer exist or have decreased. However, the increase in thecarrying amount of an asset due to reversal of an impairment loss is recognised to the extent it does notexceed the carrying amount that would have been determined (net of depreciation) had no impairment lossbeen recognised for the asset in prior years.

H. Inventories

i) Inventories are valued at lower of cost and net realizable value.

ii) The cost in respect of the items constituting the inventories has been computed on FIFO basis.

4 Appolo-31-48.p65 8/5/2010, 12:54 PM42

43

I. Expenditure incurred during the construction period

In respect of new / major expansion of units, the indirect expenditure incurred during construction period up tothe date of commencement of business, which is attributable to the construction of the project, is capitalisedon various category of fixed assets on proportionate basis.

J. Employee benefits

Short Term Employee Benefits

Short Term Employee Benefits are recognized as an expense on an undiscounted basis in the Profit and Lossaccount of the year in which the related service is rendered.

Post Employment Benefits

Defined Contribution Plans

The Employer’s contribution to Provident Fund and Employees Pension Scheme, a defined contribution plan ismade in accordance with the Provident Fund Act,1952 read with the Employees Pension Scheme,1995.

Defined Benefit Plans

The Employees Gratuity Fund Scheme, managed by HDFC Standard Life Insurance Company Ltd. is a definedbenefit plan. The liability for gratuity is provided on actuarial basis. The Present Value of the company’s obligationis determined on the basis of actuarial valuation at the year end and the fair value of plan assets is reducedfrom the gross obligations under the gratuity scheme to recognize the obligation on a net basis.

Long Term Employee Benefits

The liability for leave encashment and other compensated absences is recognized on the basis of actuarialvaluation made at the end of the year.

K. Foreign currency transactions

Transactions denominated in foreign currency are recorded at the exchange rate prevailing on the date of thetransaction.

Exchange difference arising on the settlement of monetary items or on reporting the company’s monetaryitems at rates different from those at which they are initially recorded during the year or, reported in previousfinancial statements are recognised as income or expense in the year in which they arise.

L. Borrowing costs

Borrowing costs that are directly attributable to the acquisition, construction or production of a qualifying assetare capitalized as part of the cost of the asset. Other costs are recognized as expense in the year in which theyare incurred.

M. Taxation

(i) Provision for Taxation comprises of Income Tax Liability on the profits for the year chargeable to tax andDeferred Tax resulting from timing differences between Book and Tax Profits. The Deferred Tax Asset/Liability is provided in accordance with the Accounting Standard – 22 (AS-22), “Accounting for Taxes onIncome”, issued by the Institute of Chartered Accountants of India.

(ii) Fringe Benefit Tax is provided on the aggregate amount of fringe benefits determined in accordance withthe provisions of the relevant enactments at the specified rate of tax.

N. Provisions and Contingent Liabilities

(i) Contingent liability is disclosed in the case of :

(a) a present obligation arising from a past event when it is not probable that an outflow of resourcesembodying economic benefits will be required to settle the obligation or

(b) a possible obligation, unless the probability of outflow in settlement is remote

II. Notes on Accounts

1. Estimated amount of contracts remaining to be executed on capital account and not provided for isRs. 281,155,193/- ( Previous Year Rs. 45,009,299/- ).

4 Appolo-31-48.p65 8/5/2010, 12:54 PM43

44


2. Contingent Liability

i) Claims against the company not acknowledged as debt Rs. 335,330,000/- ( Previous Year Rs. 416,721,000/-)and interest thereon. This represents suits filed against the company and the consultant doctors. Basedon the facts and circumstances, possibility of any of the claims resulting in a major financial loss to thecompany is remote. Notwithstanding above, the company is adequately insured to mitigate the possibilityof any loss.

ii) Letters of credit / Bank guarantees outstanding on account of stores / spares and medical equipmentamounting to Rs. 23,805,634/- ( Previous Year Rs. 44,619,072/- ).

3. The appeal filed by the company against assessment of property tax by MCD, has been decided by theAdditional District Judge, Delhi on 17th April, 2004 remanding the case to MCD for reassessment on the basisof directions set out in the said order.

The Company had provided Rs. 83,693,078/- against property tax liability up to 31st March, 2004. The Companyhas been advised by their legal counsel that on the basis of facts and the directions given by the HonorableJudge, the Company’s liability is not likely to exceed the amount provided for the said liability in the books ofaccount.

Further the company has provided Rs. 2,968,053/- ( Previous Year Rs. 2,968,053/- ) against property taxliability for the year ended 31st March, 2010 as per unit area method of calculating the property tax.

4. Under the terms of the agreement between the Government of NCT of Delhi and the company, the Hospitalproject of the company has been put up on the land belonging to Government of NCT of Delhi. The Governmentof NCT of Delhi is committed to meet the expenditure to the extent of Rs. 154,780,000 out of IMCL Buildingfund account (funds earmarked for the period) together with the interest thereon for construction of definiteand designated buildings while the balance amount of the cost of the building will be borne by the Company.As at 31st March, 2010, the aforesaid fund, together with interest thereon amounting to Rs. 192,357,946 havebeen utilized towards progress payments to contractors, advances to contractors, payments for materials,etc. The ownership of the building between Government of NCT of Delhi and the company will be decided ata future date keeping in view the lease agreement.

5. On a Public Interest Litigation (PIL) regarding free treatment in the hospital the Hon’ble Delhi High Court videits order dated 22nd September, 2009 has held that free treatment provided by the hospital as per the terms oflease deed with Government of National Capital Territory of Delhi shall be inclusive of medicines andconsumables. In response to the said order the company filed a Special Leave Petition in the Hon’ble SupremeCourt for appropriate directions with a prayer to stay the judgment of the Hon’ble Delhi High Court. TheHon’ble Supreme Court of India has admitted the Special Leave Petition and passed an interim order on30.11.2009. In pursuance of the interim order, the Hospital is charging for medicines & medical consumablesfrom patients referred by the Govt. of Delhi for free treatment in the Hospital.

6. Employee benefits

(i) The summarized position of Post - employment benefits and long term benefits recognised in the Profitand Loss Account and the Balance Sheet as required in accordance with Accounting Standard - 15(Revised) are as under:

Amount in Rs.

2009-10 2008-09Gratuity Leave Gratuity LeaveFunded Unfunded Funded Unfunded

(a) Expense recognised in Profit and Loss Account

Current Service Cost 7,213,599 7,814,312 6,234,867 7,639,236Interest Cost 2,967,349 2,098,323 2,802,399 1,788,260Expected return on Plan Assets (3,161,575) - (2,944,546) -Net Actuarial (Gain)/ Loss recognised in the year 4,198,477 5,752,094 1,304,375 4,274,805Total expenses recognised in theProfit and Loss Account 11,217,850 15,664,729 7,397,095 13,702,301

(b) Amount recognised in the Balance Sheet

Present value of obligation as at theend of the year 46,881,410 35,404,719 38,288,370 27,977,645Fair value of plan assets as at theend of the year 38,278,164 - 38,902,974 -Unfunded net liability recognised in theBalance Sheet (8,603,246) (35,404,719) (614,604) (27,977,645)

4 Appolo-31-48.p65 8/5/2010, 12:54 PM44

45

Amount in Rs.

2009-10 2008-09Gratuity Leave Gratuity LeaveFunded Unfunded Funded Unfunded

(c) Changes in the present obligations

Present value of obligations at beginningof the year 38,288,370 27,977,645 29,988,254 22,353,257Interest cost 2,967,349 2,098,323 2,802,399 1,788,260Current service cost 7,213,599 7,814,312 6,234,867 7,639,236Benefits paid (2,766,561) (8,237,655) (2,386,267) (8,077,913)Actuarial loss / (gain) on obligations 1,178,653 5,752,094 1,649,117 4,274,805Present Value of obligations at year end 46,881,410 35,404,719 38,288,370 27,977,645

(d) Changes in fair value of plan assets

Fair value of plan assets at the beginningof the year 38,902,974 - 23,773,204 -Expected return on plan assets 3,161,575 - 2,944,546 -Employer contribution 2,000,000 - 14,226,749 -Benefits paid (2,766,561) - (2,386,267) -Actuarial loss / (gain) on Plan Assets (3,019,824) - (344,742) -Fair value of plan assets at the end of the year 38,278,164 - 38,902,974 -

(e) Principal actuarial assumptions at the Balance Sheet Date (Expressed as weighted average).

Discount Rate 8.00% 7.50% 7.75% 8.00%Expected rate of return on plan assets 8.00% - 8.00% -(In case of Gratuity Fund)Expected rate of salary increase 5.00% 5.00% 5.00% 5.50%Method used Projected unit Projected unit

credit method credit method

(ii) The company’s contribution to providend fund scheme recognised as expense for the year are asunder:

Amount (Rs.) Amount (Rs.)

- Contribution to Providend fund 16,753,005 15,130,951- Contribution to Pension fund 12,146,354 11,906,330

7. The company had filed application for determination of question of law under section 84 of the Delhi ValueAdded Act,2004 (VAT) before the Commissioner, Trade and Taxes, Delhi (CTT) regarding the applicability ofVAT to the hospitals, inter alia, in respect of medicines and consumables administered by the hospitals in thecourse of medical treatment to its patients.

The CTT has vide its order dated 17th March, 2006 in this regard held that VAT would be applicable to thehospitals in respect of the aforesaid. The company preferred an appeal against aforesaid order of the CTTbefore Delhi VAT Tribunal. The matter is now pending before Delhi VAT Tribunal.

8. Travelling and conveyance includes Rs. 754,914/- ( Previous Year Rs. 838,047/- ) on account of Directors’travelling.

9. Other Income include Rs. Nil (Previous Year Rs.44,597,578/-) on account of export benefits under ServedFrom India, Scheme.

10. (a) For the current year ended 31st March, 2010 timing differences have resulted in a net deferred tax creditamounting to Rs. 92,48,569/-, which is adjusted to the provision for taxation for the year.

(b) Deferred Tax Liability (net) as on 31st March, 2010 is as follows:

Amount (Rs.) Amount (Rs.)2009-10 2008-09

Timing difference on account of depreciation 317,571,417 317,935,503Less: Deferred tax assets arising on account ofProvision for doubtful debts 4,738,085 4,504,612Provision for Employee benefits and others 30,823,249 5,577,247Net deferred tax liability 282,010,083 307,853,644

4 Appolo-31-48.p65 8/5/2010, 12:54 PM45

46


11. Related party disclosures

Rs. in Lakhs

Name Relationship Nature of 31st March, 31st March,Transactions 2010 2009

Apollo Hospitals Associate Pharmacy 1615.29 1374.61Enterprise Limited Consumables

License Fees 90.03 78.00

Commission on 308.65 275.46Pharmacy Sales

Reimbursement of 82.80 32.49Expenses

Account Payable 442.62 11.23

Managing Director Key Management Remuneration toPersonnel Managing Director 54.35 61.34

12. The Basic earning per share (EPS) disclosed in the profit and loss accounts has been calculated by dividingthe net profit for the year ended 31st March, 2010 attributable to equity shareholders by the weighted averagenumber of equity shares outstanding during the said financial year. The net profit attributable to equity shareholders is Rs. 31,06,00,687/- and the weighted average number of equity share is 91,673,000 for this purpose.

13. The Company has no suppilers who fall into the category of Micro, Small and Medium Enterprises as definedin “The Micro, Small and Medium Enterprises Development Act, 2006”. Hence there is no amount due to Micro,Small and Medium Enterprises for the financial year ended 31st March, 2010 (Previous Year Rs. Nil).

2009-10 2008-0914. Remuneration to Managing Director: Amount in Rs. Amount in Rs.

Salary & allowances 4,852,400 5,763,800Perquisites 582,412 370,243

As no commission is payable to the Managing Director, the computation of net profits under section 349/350of the Companies Act, 1956, is not being given.

15. Earnings in Foreign Currency:

On account of Hospital Revenue 400,697,486 445,975,783

16. Expenditure incurred in Foreign Currency:

On account of travel 1,160,672 1,857,687On account of other matters 13,472,004 12,922,871Outflow of Foreign Currency on account of dividend:On account of remittance of dividend 3,461,433 3,230,671For financial year 2008-2009 2007-2008Number of non-resident shareholders 29 29Number of shares held by them 2,307,622 2,307,622

17. Value of Imports on CIF basis:

Capital Goods 105,622,176 58,539,405

Stores & Spares 16,744,217 16,778,435

18. Payment to Auditors:

As audit fee 800,000 800,000

Tax audit fee 99,270 84,270

Total 899,270 884,270

4 Appolo-31-48.p65 8/5/2010, 12:54 PM46

47

19. Stores & Spares Consumed

Particulars 2009-10 2008-09Rs. % Rs. %

Imported 19,009,390 1.65 19,753,936 1.69Indigenous 1,129,702,775 98.35 1,147,195,523 98.31

Total 1,148,712,165 100 1,166,949,459 100

20. Materials consumed are of varied nature and include items of food, beverages, medical consumables etc.Therefore it is not feasible to give the details as required under part II of schedule VI to the Companies Act,1956.

21. The company is engaged in the healthcare business, which in context of Accounting Standard 17 issued bythe Institute of Chartered Accountants of India is considered the only business segment.

22. Previous year figures have been regrouped/rearranged wherever necessary.

23. Schedule 1 to 10 form an integral part of the Balance Sheet and Profit & Loss Account and have beenauthenticated as such.

24. All figures have been rounded off to the nearest rupee.




4 Appolo-31-48.p65 8/5/2010, 12:54 PM47

48


BALANCE SHEET ABSTRACT AND COMPANY’S GENERAL BUSINESS PROFILE

I. Registration Details

Registration No. : 55-30958 State Code : 55

Balance Sheet 31 03 2010

Date Month Year

II. Capital raised during the year (Amount in Rs. '000)

Public Issue NIL Rights Issue NIL

Bonus Issue NIL Private Placement: NIL

Foreign Direct Investment NIL

Promoters NIL

III. Position of Mobilisation and Deployment of Funds (Amount in Rs. '000)

Total Liabilities 1,931,899 Total Assets 1,931,899

Sources of Funds

Paid-up Capital 916,730 Reserves & Surplus 440,273

Share Application Money NIL Unsecured Loans —

Secured Loans 292,886 Net deferred tax liability 282,010

Application of Funds (Amount in Rs. '000)

Net Fixed Assets 2,058,680 Capital Work in Progress 36,714

Net Current Assets (163,495) Investment Nil

Accumulated Losses Nil Misc. Expenditure -

IV. Performance of Company (Amount in Rs. '000)

Total Income 4,364,798 Total Expenditure 3,899,271

Profit/Loss Before Tax 465,527 Profit/Loss After Tax 310,601

Earning per share in Rs. 3.39 Dividend 146,677

V. Generic Names of Three Principal Products/Services of Company (as per terms)

Item Code No. (ITC Code): —

Product Description: Health Care Services

4 Appolo-31-48.p65 8/5/2010, 12:54 PM48

49

INDRAPRASTHA MEDICAL CORPORATION LIMITED

Hospital Complex, Sarita Vihar, Delhi-Mathura Road, New Delhi - 110 076

PROXY FORM

DP Id...........................

Client Id........................... Folio No. ...................................

(For shares held in Demat Form) (For shares held in Physical Form)

I/We ............................................................................................................................................

being a Member/Members of Indraprastha Medical Corporation Limited hereby appoint

........................................................................... of ............................................................... in the

district of ...................................................................................... or failing him .........................

.............................................................. of ................................................................................ in the

district of ............................................................ as my/our Proxy to vote for me/us on my/our behalf at the

Annual General Meeting of the Company to be held on Friday, 10th September 2010 at 12.15 p.m. at FICCI

Golden Jubilee Auditorium, Federation House, Tansen Marg, New Delhi - 110 001 and at any adjournment

thereof.

Signed this ................................................ day of ....................................................... 2010.

Signature

NOTE: The instrument appointing Proxy should be deposited at the Registered Office of theCompany not later than 48 hours before the commencement of the Meeting.

AffixRevenueStamp

INDRAPRASTHA MEDICAL CORPORATION LIMITED

Hospital Complex, Sarita Vihar, Delhi-Mathura Road, New Delhi - 110 076.

ATTENDANCE SLIP

DP Id..........................................

Client Id..................................... Folio No.......................................

(For shares held in Demat Form) (for shares held in Physical Form)

Name of the Member .......................................................................................................................

No. of Shares held ......................................................................................................................

Name of Proxy ............................................................................................................................

(To be filled in only when a Proxy attends the Meeting)

I hereby record my presence at the Annual General Meeting held on Friday,

10th September 2010 at 12.15 p.m. at FICCI Golden Jubilee Auditorium, Federation House,

Tansen Marg, New Delhi -110 001

Signature of Member/Proxy

4 Appolo-31-48.p65 8/5/2010, 12:54 PM49

4 Appolo-31-48.p65 8/5/2010, 12:54 PM50

November 02, 2009. A red letter day in the history of Apollo Hospitals. A day when the nation decided to confer a much deserved recognition on the organisation for its pioneering spirit, commitment to healthcare and service to the nation. Dr. Prathap C. Reddy, Founder- Apollo Hospitals Group stated, "it's not just a reward for our performance, but is a powerful motivation for the entire Apollo family to pursue its unshakeable belief that every person has a right to live a healthy happy life."

Indraprastha Medical Corporation LimitedRegistered office & Hospital Complex

Sarita Vihar, Delhi-Mathura Road, New Delhi - 110076 (India)Visit us at: www.apollohospdelhi.com

Prin

ted

at T

hom

son

Pre

ss

Documents

Apollo AR-09-10 · Apollo Hospitals (UK) Ltd. Apollo Munich Health Insurance Company Ltd Indian Hospitals Corporation Ltd. Imperial Cancer Hospital & Research Centre Ltd